French Supermarkets Revolt Against "Unacceptable" Prices from Agro-Industrialists

 

Shock formulas, public denunciation of prices, and a united front against high living costs: the revolt is spreading across French hypermarkets and supermarkets. Carrefour, one of the major players, made headlines by boycotting crisps and other PepsiCo products on January 4, citing "unacceptable price increases." This move has triggered a sector-wide rebellion, just weeks before the culmination of commercial negotiations with agro-industrialists.

Carrefour, a leading food distribution giant, took a bold step on Thursday, removing popular brands like Lay's, Doritos, Quaker, Pepsi, and 7Up from its shelves in France. "We no longer sell this brand due to unacceptable price increases," declared Carrefour, with sources revealing that the delisting extends to Carrefour stores in Belgium, Spain, and Italy.

The sector-wide resistance aligns with the recent declaration of E.Leclerc's media representative, Michel-Edouard Leclerc, who emphasized challenging inflation during negotiations with industrial suppliers. The balance of power between supermarkets and major manufacturers intensifies as annual commercial negotiations, determining crucial conditions of sale, approach their end in late January.

The government's decision to expedite negotiations, ending on January 15 for smaller suppliers, anticipates that reductions in raw material costs, such as wheat and oil, will promptly reflect on shelves.

Major stores report facing demands for price increases, exemplified by Coca-Cola's assertion of a 7% average increase in November. While these negotiations unfold, distributors are taking unprecedented measures, with Carrefour leading the way. Delisting serves as a tool to apply pressure on manufacturers and demonstrate their commitment to defending purchasing power.

This strategic move by Carrefour mirrors the approach of other brands. Système U's Dominique Schelcher revealed earlier delistings, stating, "Pepsi. Not just sodas, but also chips. The blow is off." Even Michel-Edouard Leclerc acknowledged the practice, cautioning that it's a tough game, as consumers want affordable products available.

As negotiations intensify, the industry anticipates rigorous discussions. With shopping basket prices surging by an average of 20% over the last two years, supermarkets are determined to secure price reductions, even if it means wearing "boxing gloves" in the negotiations.

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