Tupperware CEO blasts cheap US consumers

Rick Goings blames a 'Wal-Mart market' for his company's problems but ignores its dated domestic image.

By Jason Notte Feb 1, 2013 1:48PM
Image: Woman holding empty purse ( image100/Corbis)When a guy whose entire job involves getting you to buy plastic kitchen storage containers calls you cheap, it just might be true.


As Tom Gara at the Wall Street Journal gleaned from Tupperware (TUP) chief executive Rick Goings' Tuesday earnings call, he's not exactly happy with the buying habits of the average cheese-product-eating, soda-swilling, dollar-store-dwelling American.


In fact, in a quarterly report made available on Seeking Alpha and dominated by the 60% of Tupperware's business from emerging markets in South America and Asia and its growth in European countries like Germany, Goings bluntly explained to Bank of America Merrill Lynch analyst Olivia Tong why his mix of products isn't succeeding in the U.S.:


We are a high-quality product and a brand. Why do we do better in Europe than we do in the U.S.? Hey, take a look at the average brand of cab that you get in the New York cities. I mean, they're filthy, they're junk. Get in a cab over here, it's a Mercedes or an Audi. The U.S.A. is basically a Wal-Mart (WMT) market. Our top-tier products like the Microsteamer or the Ultraplus that are 100-year-old products, hard to sell them in the U.S., because that's a discount market over there.


That most Americans have no idea what the Microsteamer reheatable steamer/colander and Ultra Plus casserole dish lines are bolsters his point a bit. Still, The Huffington Post argues that most Americans aren't springing for $30 steamers they can hand down to the grandkids, because the money just isn't there.


The Social Security Administration puts the median annual wage at $26,965, while the Corporation for Enterprise Development notes that most Americans are one emergency away from financial ruin. Combined with stagnant unemployment numbers and a recent downturn in the gross domestic product, the loss of the payroll tax break has taken a toll on U.S. consumer confidence.


But that's letting U.S. consumers off a bit too easy. As Goings says, "Europe buys quality, Japan buys quality." As the Guardian acknowledges, Japan just fell into a recession, while Europe's austerity measures and bailouts couldn't prevent a double-dip recession there. The U.S. isn't the only nation going through hard times, yet it's the one coping with disposable plastic from the supermarket instead of slightly costlier product that will last far longer.


What that has to do with the brand or reliability of cabs in either market is still anyone's guess, but the greater point about Americans' fear of the up-front cost shouldn't be lost on a country that made Wal-Mart the largest retailer in the nation and No. 2 on the Fortune 500 one cheap plastic resin chair at a time. Just because it's true, however, doesn't make it a great thing to say to potential customers.


Nor does that truth make it Tupperware's only problem in the U.S. market. Sure, its products aren't cheap, but they're also attached to a dated image of mid-century American domesticity that no longer exist. Those Betty Draper-style semi-mute subservient housewives in pearls have faded into suburban history and aren't throwing Tupperware parties anymore. Even Goings admits that one of his "dumb" decisions in the U.S. was "recruiting younger women by giving her products that a 50-plus-year-old woman would like." Maybe American consumers can do better than a $1.99 pack of disposable plastic containers, but why should they buy Tupperware if the product they're being sold doesn't differ much from the sets their parents and grandparents are handing down for free?


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697Comments
Feb 1, 2013 7:46PM
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Rick Goings just shot himself in the foot with his comments. Now he probably wont have to worry about us "cheap Americans" anymore not buying his stuff after this. 

I'll stick with Pyrex and Lock & Lock as I have done for many years.
Feb 1, 2013 7:46PM
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I don't buy Tupperware because of the cost.  I'm always sending home leftovers to my kids who seldom return the containers.  I buy the cheaper plastic containers because I have little invested in them.   Plus, I wouldn't go to a Tupperware party because I feel pressured to buy something I really don't want!
Feb 1, 2013 7:46PM
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I remember my mother going to tupperware parties, given by hostesses.  They were small franchises and did home parties and were a "stepped opportunity" business.

Tupperware is expensive, gimicky and not worth the money.   If you you can't change

your business model to make your products better and your business profitable that

is your fault.  Don't blame the American public for being cheap.

Feb 1, 2013 7:45PM
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The facts are here in this article,But the problem I think is the fact that I made $25,000 dollars a year in 1977

and I make less then that today ! I could buy a new CAR nice for $8500 dollars. Fuel for the car then $0.60 a gal.

Now $4.00 gal. etc. on and on

Feb 1, 2013 7:45PM
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Our wages are not comparable to Europeans who by the way don't work as many hours as we do.  We are becoming a third world country but people don't believe it.  Plus Tupperware can't be handed down generations.  It's plastic!!!!!  It doesn't last like the porcelain colanders from the old days.  Tupperware is a rip off!!!!!!!  Buy things that will last
Feb 1, 2013 7:45PM
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I have 20 yr old Tupperware that have no lids or doesn't close all the way. I was disappointed with the CEO of the company calling American's cheap. You need to remember we are responsible you can hold the title.

 

Feb 1, 2013 7:44PM
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The problem with our country is Jerks like Mr. tupperware , why buy that crap when  you can buy a much better product that serves the purpose much better than the 50 year old plastic made in china he is selling !!!
Feb 1, 2013 7:44PM
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if you want to call me cheap because i will not spend $30 on plastic kitchen ware than call me cheap .... for cooking i use stainless steel or cast iron ... for food storage i use the old pyrex food storage glass ware 
Feb 1, 2013 7:42PM
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Tupperware CEO appears disconnected from the world of reaity so if his company goes under it wil be his owm damn fault.  OF COURCE MOST AMERICANS ARE CHEAP, BUY THE CHEAPEST GROCERIES, BUY ZIPLOCK INSTEAD OF TUPPERWARE. tHEY DON'T HAVE ANY CHOICE IF THEY WANT TO EAT AND NOT STARVE, KEEP THE LEFT-OVERS FROM SPOING WITH ANOTHER PRODUCT JUST AS GOOD BUT COST CONSIDERABY LESS.   WHAT PLANET IS MR. GOINGS REALLY FROM, 'CAUSE IT AIN'T EARTH!! 
Feb 1, 2013 7:42PM
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Your dangerous plastic product (in my opinion) are cheap!  Why pay for low quality products.
Feb 1, 2013 7:42PM
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Not the best comment from this american A*Hole keep up with technology and make better products, maybe I'll buy ONE to try!! good luck bud!!
Feb 1, 2013 7:42PM
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i think a lot of americans are to stupid to not use walmart
Feb 1, 2013 7:42PM
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Because of this insult to consumers, calling them "cheap", now I will no longer consider buying any more Tupperware!

 

I never thought it that special anyway. I always hated how it absorbed smells, and became discolored so easily. And the lids always got warped after awhile. 

 

So what if it goes under? There are a zillion products out there in any price range that could fill anyones need for anything and probably better than Tupperware. What a stupid name anyway! 

Feb 1, 2013 7:41PM
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Our market is flooded with cheap products...no doubt. But is Tupperware quality?

Who wants to store food in plastic?  Not healthy... and doesn't hold up.

Get with it , Monsieur Crabatron.

 

Feb 1, 2013 7:41PM
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YOU GET PRODUCTS JUST BY BUYING PRODUCTS THAT COME IN FREE PLASTIC CONTAINERS AND THEY OUTLAST TUPPERWARES CRAP

 

Feb 1, 2013 7:40PM
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In reality I have been ditching plastic like the plague recently. I have been going old school like steel pots and pans as well as glass to store my stuff. It is in fact more expensive but I suspect plastics in our society will keep peeling layers of its cancer causing potential. It is also our own misuse of it that is the issue with microwaving containers or putting them in the dishwasher when we aren't supposed to. Remember that pasta you heated up in the microwave and it left a big stain on your plasticware? The food penetrated your container....and the plastic from the container penetrated your food. There is a reason why Coke in a plastic bottle just doesn't right.

Feb 1, 2013 7:39PM
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The CEO does have a point.  Since the 1980s, Americans have been focusing more on lower-cost items.  As a result, product engineers and manufacturers have converged to deliver what we want, albeit the product is cheaply made.  Many would call this the "I have to have it now!" generation; so many refuse to wait, save their money and purchase quality-made.  Personally, I believe the Dollar Store and their competitors are scummy and deliver what many want - cheaply priced products that are cheaply made; you get what you pay for.  Don't get me wrong - I LOVE Goodwill Industries and second-hand shops, and I just believe this dollar-item mentality is sub-par.
Feb 1, 2013 7:38PM
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Tupperware is messy.  It is hard to store and takes up lot of room that most people don't have.  It ends up landfills and is a wasteful product. Why buy tupperware when there are many US made products that last longer, are easy to store, and don't end up in landfills because they are worth passing down to the kids. Sounds like someone is worried about himself and his own bottom-line.  Looks like he just set himself up to lose any prospective customers he may have had in the US. Good Job dummy!
Feb 1, 2013 7:38PM
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I use to love Tupperware but it didn't last as hand me downs.  I bought Tupperware from a friend's party about 2 years ago, I should have saved my money instead by buying the "cheap" stuff.  I bought the cereal bowls with lids and what was my favorite product in the 90's the shake 'n pour. Lids didn't fit and I was told I "just needed to heat the lids in water the first time I use them". After 3 times they went to Goodwill, quality of Tupperware is not what it use to be. I've got a cabinet of Rubbermaid plastic containers for leftovers now and other similar products to the shake 'n pour. 
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