Empty shelves as German supermarkets resist price hikes

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As German inflation hits a record 10%, supermarket giants are resisting what they see as unreasonable price increases by some of the world’s best-known brands.

Florian CAZERES

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German shoppers are increasingly finding empty shelves where their favorite cereal, Mars chocolate bar or favorite brand of rice used to be, as supermarkets clash with big food companies over price hikes.

“Dear customers, we are sorry to inform you that we cannot currently offer all products from our supplier Mars GmbH,” reads a sparsely stocked aisle of an Edeka supermarket in central Berlin.

As German inflation hits a record 10%, supermarket giants are resisting what they see as unreasonable price increases by some of the world’s best-known brands.

Multinational food companies say their manufacturing costs have risen due to soaring energy and transport costs, in part because of the war in Ukraine.

But retailers in Europe’s biggest economy say they are protecting customers’ purchasing power at a difficult time and that price hikes of up to 30% in some cases are overkill.

“Many international brands are trying to take advantage of inflation to overprice to increase their profits,” an Edeka spokesperson told AFP, calling the March price demands “unwarranted. “.

Edeka and rival Rewe, two of Germany’s biggest supermarket chains, have stopped shipping around 300 products from the Mars company, known for its Twix and Snickers bars, Ben’s Original rice packets and Whiskas cat food.

They have also used the supermarket confrontation to promote their cheaper own brand products as alternatives.

Mars, for its part, blames the “volatile context” and “inflationary pressure”.

Thomas Roeb, a retail expert at the Bonn-Rhein-Sieg University of Applied Sciences, said the battle over brands was not new and items are drawn every year in squabbles between supermarkets and retailers. food companies.

“But this time it went a little less unnoticed, because Edeka and Rewe are hit at the same time,” Roeb told AFP.

At the Edeka in Berlin, the absence of pet food, an area where Mars dominates, is particularly glaring.

In a nearby Rewe, the rice aisle is half empty.

The cereal section also appears empty, after Rewe failed to reach a compromise with US company Kellogg’s – which German media said was asking nearly 30% more for its popular breakfast.

Similar price wars are raging with other brands.

In some stores, Jacobs Douwe Egberts tea and coffee products are missing from the shelves.

Discounters Aldi and Lidl do not stock Danone, the world’s largest yogurt maker.

Edeka and Coca-Cola are tussling in court, with the supermarket appealing a recent ruling saying the drinks giant was within its rights to halt deliveries over the dispute.

“There is a shortage of food, drink and even hygiene products,” said Leana Kring, 24, outside a supermarket on Karl-Marx-Allee boulevard in Berlin.

Supermarket woes add further pressure to German consumers, who are already bracing for a bleak winter amid high inflation and a worsening energy crisis following the cut in gas supplies from Russia .

The German economy, usually an engine of European growth, is expected to tip into recession next year.

A Rewe spokesperson told AFP that supermarkets do not want to see shoppers “unnecessarily penalised” in “difficult times”.

But retailers have also seized the opportunity to promote their private label products, which have grown in popularity as Germans try to watch their pennies.

“Astronomical Mars prices? So buy Netto,” read a recent tongue-in-cheek Instagram post from discounter Netto, owned by the Edeka Group.

At a Rewe store in Berlin’s Friedrichstrasse station, the supermarket’s “Ja” (Yes) cereals have already replaced the colorful rows of Kellogg’s boxes.

Own-brand sales accounted for 34.6% of German supermarket revenue in the first quarter of 2022, according to GfK pollsters, up 1.2 percentage points from a year earlier.

“It’s cheaper and it tastes the same,” said Mirjam Branz, a 30-year-old Berliner, as she left Rewe.

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