Coconut water sales spike for Vita Coco during coronavirus outbreak
Sales of products from Vita Coco, which makes shelf-stable coconut waters and canned traditional waters, have spiked sharply — starting two weeks ago on the West Coast. and accelerating nationally during the past few days via e-commerce platforms.
“Sales on Amazon started growing north of 50% [at the beginning of March],” Michael Kirban, co-founder of Vita Coco and CEO of its parent company All Market, told CNN Business. “At the same time, really, Costco was telling us: ‘We need more product quickly.'”
Vita Coco’s coconut water sales soared 200% on Walmart.com compared to the previous year, and sales via Amazon shot up 60% through March 8.
At All Market, the company “got comments [from retailers] saying, ‘Send us whatever you can,'” Kirban said.
But that isn’t so easy right now. For Kirban’s company and others, the sudden surge in demand has created upheaval in product manufacturers’ typical courses of business and shocked supply chains in the process.
Typically at this time of year, the Vita Coco warehouses are full of product in preparation for the busy spring and summer seasons. Now those stockpiles are quickly depleting. So, at a time when the company’s manufacturers in Southeast Asia and Brazil would be winding down and operating at 60% to 70% capacity, they’re running full tilt.
“We still have a good 40 days’ inventory on hand for all items,” Kirban said. “It happened at a point in time that we’re able to keep up.”
Vita Coco’s supply chain remains intact, at least for now. The fully packaged beverages continue to arrive via ship — a three-week boat trip from the Asian ports and a nine-day trip from Brazil — and stored in warehouses in places such as California, Texas, Florida, Washington State and up the Eastern Seaboard. As long as the borders remain open for cargo, the supplies will continue to arrive, Kirban said.
“There are no coconuts in the US,” he said. “If we can’t bring in coconut water, [Vita Coco is] in trouble.”
That potential scenario underscores the strangeness of this business boon for VIta Coco and Kirban.
“We’re dealing with these massive spikes in business,” he said. “Yet the world is falling apart.”