Erosion risks

• Private-label quality improves and shoppers trade down in weak consumer environments
• Brand damage from safety incidents, recalls, or efficacy controversies
• Category commoditization (price/promo-driven buying)

Leading indicators

• Category value/volume share trends (e.g., Nielsen/IRI) for bleach, disinfecting wipes, cleaners
• Net price realization vs private label gap
• Promotional intensity / trade spend levels

Counterarguments

• Cleaning products can be low-switching-cost and heavily promotion-driven
• Large CPG peers can outspend on marketing and innovation in subcategories

Erosion risks

• Retailer consolidation increases buyer power and private-label push
• Shelf-space reallocation or delistings
• E-commerce shift changes merchandising and pricing dynamics

Leading indicators

• Walmart % of net sales disclosed in filings
• In-stock rates / service levels at top retailers
• Mix shift across channels (club vs grocery vs e-commerce)

Counterarguments

• Retailers ultimately control shelf space; this is not a true "control" moat
• High customer concentration can compress margins via pricing pressure

Erosion risks

• Competitors can obtain similar EPA registrations and parity claims
• Regulatory changes increase compliance costs or restrict claims
• Institutional buyers prioritize total cost and service over brand

Leading indicators

• Clorox product presence on EPA antimicrobial lists (e.g., List N)
• Institutional contract wins/losses and distributor relationships (if disclosed)
• Professional segment volume trends vs consumer categories

Counterarguments

• EPA registration is not exclusive; many rivals are also registered
• Procurement cycles and contracts can favor low-cost providers

Erosion risks

• Ecolab/other specialists differentiate via service + integrated programs
• Any efficacy controversy could harm trust in healthcare settings

Leading indicators

• Professional portfolio expansion (new SKUs, claims, distributor listings)
• Share trends in healthcare/institutional disinfectants (if available)

Counterarguments

• Professional channels often value service models where specialists have an edge
• Switching can be easier than in regulated medical devices (no deep lock-in)

Erosion risks

• Private label gains if price gaps widen
• Input cost volatility (resins) forces list-price churn
• Quality slip leads to fast brand switching

Leading indicators

• Category share vs Hefty/private label
• Elasticity and promo depth trends
• Gross margin sensitivity to resin indices

Counterarguments

• Trash bags are functionally similar across brands; consumers often buy on price/promo
• Retailers can allocate more shelf space to store brands

Erosion risks

• Retailer consolidation increases buyer power
• JV wind-down execution issues (supply chain, commercialization) impact service levels

Leading indicators

• Service level / in-stock performance during JV transition
• Household segment volume vs category
• Changes in retailer shelf placement

Counterarguments

• Retail channels are not controlled by the manufacturer; they can shift shelf space rapidly
• Transition risk could temporarily weaken brand momentum

Erosion risks

• Commodity inputs and pricing pressure
• Private label and value brands improve quality
• Pet specialty channel dynamics shift brand mix

Leading indicators

• Category share vs Arm & Hammer / Purina and private label
• Promo intensity and price per pound trends
• Consumer review sentiment for key SKUs

Counterarguments

• Switching costs are low; many consumers trial based on price or availability
• Competitors can match performance claims with incremental innovation

Erosion risks

• Retailers allocate shelf space to private label/value brands
• Transportation and logistics costs reduce category profitability

Leading indicators

• In-stock rates and logistics service metrics
• Channel mix shift (pet specialty vs mass retail)

Counterarguments

• Distribution breadth is shared by most large pet categories players
• Retailers can quickly change planograms

Erosion risks

• Category commoditization and private label encroachment
• Weather-driven volatility and seasonality
• Shift from charcoal to alternative grilling methods (gas/electric)

Leading indicators

• Seasonal shipments vs category
• Price gap vs private label charcoal
• Household segment gross margin trend (proxy)

Counterarguments

• Charcoal is often a commodity purchase; switching costs are minimal
• Brand advantage may not translate in discount channels

Erosion risks

• Private label share gains and value-tier switching
• Changing consumer preferences (health, fresh, refrigerated alternatives)
• Retailer promotion requirements compress margins

Leading indicators

• Brand share in dressings/dips vs private label
• Promo depth and frequency
• Mix shift toward refrigerated/foodservice (if disclosed)

Counterarguments

• Low switching costs and heavy promotion can cap brand-driven pricing
• Many large food companies can match innovation and distribution

Erosion risks

• Third-party compatible filters reduce switching costs and pricing power
• Competitors (e.g., PUR) claim superior filtration and target Brita installed base
• Shift to under-sink systems or bottled water alternatives

Leading indicators

• Replacement filter attach rate / repeat purchase metrics (if disclosed)
• Private label/compatible filter penetration on major e-commerce platforms
• Category share in filtration systems and filters

Counterarguments

• Consumers can switch systems; filters are not always proprietary
• Competitors can subsidize systems to win future filter revenue

Erosion risks

• Trust can erode from filtration performance controversies or competitor comparative claims
• Regulatory scrutiny around contaminant reduction claims

Leading indicators

• Brand consideration and share vs PUR
• Complaint/return rates and review sentiment for flagship filters

Counterarguments

• Category leadership claims may not translate into durable pricing advantage if compatible filters proliferate
• PUR and others aggressively compete on performance claims

Erosion risks

• Brand relevance risk as consumer preferences shift quickly
• New digital-native brands and private label compete on "clean" positioning
• Ingredient/regulatory controversies can damage trust

Leading indicators

• Velocity in key channels (mass, drug, e-commerce)
• Search/social sentiment for Burt's Bees vs emerging brands

Counterarguments

• Low switching costs and high product variety limit moat strength
• Large beauty incumbents can replicate 'natural' sub-brands

Erosion risks

• Local brands and private label undercut on price
• FX volatility and import restrictions affect competitiveness
• Geopolitical/logistics disruptions

Leading indicators

• Organic sales growth and FX impact disclosure for International segment
• Market share trends in key countries (if disclosed)

Counterarguments

• Brand advantage varies widely by country; local incumbents can dominate
• Distribution and pricing are often constrained by local retail structures

Erosion risks

• Distributor disintermediation or renegotiated terms
• Channel concentration in key countries

Leading indicators

• Distributor/retailer concentration metrics by region (if disclosed)
• Supply chain service levels in key international markets

Counterarguments

• Scale of reach does not equal control; local players also have distribution
• Cross-border operations add complexity that can reduce execution speed