Specialist
Former Group President at Tupperware Brands Corp
Agenda
- Key trends and developments in the kitchenware industry
- Competitive dynamics and Tupperware's (NYSE: TUP) turnaround efforts
- Tupperware's (NYSE: TUP) sales challenges and potential near-term levers amid a challenging demand environment
- Sales model differentiation vs other MLM (multi-level marketing) players
Questions
1.
Could you start by sharing 2-3 key trends within the kitchenware industry that you’ve been following? What do you think investors should be aware of?
2.
What do you think has been the impact of the coronavirus pandemic on the industry, and on Tupperware specifically? Are there any challenges that you think were exacerbated by the pandemic?
3.
Tupperware reported stronger-than-expected Q2 numbers, and though its active sales force declined again, it was productivity that increased meaningfully, in particular within the US and Canada. The assumption is that the salesforce has been successfully leveraging online tools, such as social media. The management team has pointed to this being sustainable and replicable in other regions. Do you think that is the case?
4.
How much of the pickup in US demand was driven by this one-time coronavirus-related boost in demand for Tupperware items?
5.
How likely do you think Tupperware’s cost-cutting efforts are to succeed? Specifically assuming they trim costs in foreign jurisdictions by removing managers and centralising everything.
6.
You mentioned the dynamics in the sales or compensation structure. Does the business benefit from high unemployment relative to other MLMs [multi-level marketing] companies?
7.
Why would a sales rep choose Tupperware vs another MLM? What should we fundamentally understand about the compensation structure, and how it might differ from similar firms?
8.
Are there clusters of sales reps that operate under a group, similar to a real estate structure where they’re operating under a brokerage or is it just individual, single sales reps? I guess that this may differ by geography.
9.
What is your opinion on Tupperware’s turnaround strategy?
10.
You mentioned Tupperware has an offering issue. Is this due to a lack of innovation? What do you think about the strength of the Tupperware brand itself? How would you contrast that to its offerings?
11.
Is there reason to believe that the brand can be expanded into other categories or shift increasingly online, given what has happened during the pandemic?
12.
You mentioned Natura, a Brazilian beauty enterprise. If we evaluate Tupperware’s beauty business in Mexico, are there any potential buyers for that business, and how should we think about the likely price tag or valuation for it?
13.
Are there any potential buyers you would highlight for the whole Tupperware company, either thinking about other potential strategic buyers within MLM, or other businesses?
14.
If we assume Natura was targeting Tupperware during the height of the pandemic when the stock was trading in the single digits, as you mentioned, are there any hidden jewels in the Tupperware portfolio that you think Natura may have missed?
15.
Could you outline some of the key geographies in the portfolio? How do you believe Tupperware is positioned across some of these key markets?
16.
What makes Tupperware’s sales model different from other MLM names such as Natura and Avon?
17.
Do you believe that Tupperware’s turnaround could be near-term? Can it maintain the momentum through year-end or was Q2 really a one-off and is the company likely to revert to weakness immediately in Q3?
