Del Monte Foods Files for Chapter 11 Bankruptcy Amid Declining Sales and Changing Consumer Preferences
Del Monte Foods has filed for Chapter 11 bankruptcy protection, citing declining sales of canned products and shifting consumer preferences towards fresher options.
Overview
- Del Monte Foods, a 139-year-old company, has filed for Chapter 11 bankruptcy protection due to declining sales of canned fruit and vegetables.
- The company has secured over $900 million in debtor-in-possession financing to support its operations during the bankruptcy process.
- Despite some sales growth in products like Joyba and broth, it was insufficient to offset the decline in canned product sales.
- Consumer preferences are shifting towards fresher, preservative-free options, exacerbated by grocery inflation leading to a preference for affordable store brands.
- Del Monte faced a lawsuit from lenders last year regarding its debt restructuring plan, contributing to its decision to seek bankruptcy protection.
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Analysis
Center-leaning sources frame Del Monte Foods' bankruptcy as a significant corporate failure, highlighting shifting consumer preferences and economic pressures. They express concern over the company's legacy and financial struggles, emphasizing the impact of grocery inflation and competition from healthier alternatives. Implicit bias suggests skepticism about the company's future viability.
Articles (6)
Center (2)
"…Del Monte Foods is filing for bankruptcy protection as U.S. consumers increasingly bypass its products for healthier or cheaper options."
Associated Press·12d·"…Del Monte Foods, whose canned vegetables and fruit have long been a staple on grocery store shelves, announced Monday that it has filed for bankruptcy and will seek a buyer."
CBS News·12d·FAQ
Del Monte Foods filed for Chapter 11 bankruptcy due to declining sales of canned fruit and vegetables, changing consumer preferences towards fresher, preservative-free products, and the impact of grocery inflation pushing consumers towards more affordable store brands. Additionally, a lawsuit from lenders last year over debt restructuring contributed to the decision.
Del Monte Foods has secured over $900 million in debtor-in-possession financing to support its operations during the bankruptcy process.
Yes, Del Monte Foods saw some sales growth in products such as Joyba and broth, but these increases were insufficient to offset the overall decline in canned product sales.
Consumer preferences have shifted towards fresher, preservative-free options, which, combined with grocery inflation, have led to increased demand for affordable store brands and reduced demand for traditional canned products.
Del Monte Foods had been in operation for 139 years before filing for Chapter 11 bankruptcy.
History
- 12d
3 articles