Capital-Intensive Toilet Paper Firms, Already Near Capacity, Unable to Quickly Fill 600% Surge in Demand

(p. 4) As the chief executive of a company that makes toilet paper, Joey Bergstein has been through an intense few months.

. . .

You’ve mentioned that you anticipated some demand, but nothing like what was about to come.

The week of March 8 [2020] we saw a surge in demand of somewhere between 600 and 750 percent. When you build a supply chain and package, you normally have about a 30 percent buffer to be able to meet a surge in demand. Nobody built a supply chain to be able to respond to that kind of surge in demand. So the team has been in a constant state of triage ever since, and we’re still in that.

. . .

What was it about toilet paper that made it so hard to come by?

First of all, nobody anticipated the level of stocking up you would see on toilet paper. That shocked everybody. But any of these paper businesses are very capital-intensive businesses. You only make money in that business if you’re running your machines pretty close to capacity. So when you have a big surge in demand, it’s hard to increase more than you’re already producing, because you’re generally producing pretty close to capacity. You don’t have the kind of flexibility that you would normally expect to have in another business.

For the full interview, see:

David Gelles, interviewer. “Selling 2-Ply in a Pandemic (It’s Harder Than You Think).” The New York Times, SundayBusiness Section (Sunday, June 7, 2020): 4.

(Note: ellipses, and bracketed year, added; bold in original.)

(Note: the online version of the interview has the date June 5, 2020, and the title “Selling Toilet Paper and Paper Towels During the Pandemic.” The first sentence and the bold questions are from the interviewer David Gelles. The answers after the bold questions are from the interviewee Joey Bergstein.)

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