Trending: Pet Food Pet food economics with Ernie Tedeschi of Yale Law School
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Mar 12, 2025 Ernie Tedeschi, Director of Economics at The Budget Lab of Yale Law School, delves into the economics of the pet food industry. He discusses consumer behavior shaped by real wages and pricing dynamics, revealing how essential pet care spending often prevails over discretionary costs. Tedeschi also highlights challenges posed by global trade tensions and tariffs, specifically regarding imports from China. His insights on industry resilience and the importance of adapting to economic uncertainties make for a compelling listen.
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CPG Influencers
- Consumer packaged goods (CPG) are affected by real wages, pricing, and consumer price sensitivity.
- Other factors include consumer expectations, tastes, and demographics, with real wages being the most impactful.
Pet Food's Resilience
- Pet food, like baby formula, shows strong resistance to price changes, with consumers prioritizing pet needs over their own.
- This resilience has benefited the industry, but everyone has a breaking point, raising concerns about current economic conditions.
Pet Spending and Economic Cycles
- Pet spending is generally resistant to economic downturns, unlike most consumer goods.
- Veterinary care, however, is highly sensitive to economic cycles, with spending decreasing during downturns.