Clorox hack could help competitors grab market share

Clorox is at risk of losing market share to competitors after a cybersecurity attack idled its U.S. factories, tightening supplies of the company’s goods from bleach to cat litter.

The producer of Pine-Sol floor cleaner and Kingsford charcoal briquettes said earlier last week that the vast majority of its U.S. factories have resumed output after production was halted amid the fallout from the attack. Some plants are still offline, however. After the output pause, empty shelf space is now evident at retailers. That means shoppers will buy competing products — and analysts say some of the shifts could stick.

“Any time a company has an out-of-stock product, that’s the opportunity for the consumer to shift to a different brand. I think we saw that during the pandemic,” said Edward Jones analyst Brittany Quatrochi. “There are some other companies that could pick up the pieces.”

Clorox has been tightlipped on the details of the hack, while telling investors “the unauthorized activity has been contained.” The company is working with the FBI, and said on Sept. 18 that it’s “aware of an elevated level of consumer-product availability issues.” It’s repairing its information-technology systems that were damaged and its automated ordering system is expected to resume this week. Production is increasing but Clorox says it doesn’t have an estimate for how long before the situation is back to normal.

Store checks at a Target store and two Walgreens pharmacies in Chicago showed that some Clorox products were running low or out of stock, including toilet cleaner, Glad garbage bags and Formula 409 all-purpose cleaner. In Dallas, Fresh Step kitty litter was running low or was out of stock at multiple Target and Walmart locations. Scoop Away, another Clorox product in the same category, was only available at a few Walmart stores.

When contacted by Bloomberg News, Clorox referred to its Sept. 18 statement.