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French grocer Carrefour says non! to PepsiCo price hikes

January 5, 2024
in Business
French grocer Carrefour says non! to PepsiCo price hikes
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A bottle of Pepsi gets poured out.

Photo: Anthony Devlin—PA Images via Getty Images (Getty Images)

In France, like most places, if you want to drink a Pepsi you just go into the store and buy one. Unless the store is Carrefour. Then, tant pis pour toi! The French supermarket chain has pulled not just sodas, but all PepsiCo products from its shelves in a bid to rein in the company’s price hikes. The news was first published by French journalist Olivier Dauvers and confirmed by the broadcaster BFM Business.

Did the market get too far ahead of itself? | Smart Investing

Consumers reaching for Pepsi products will instead encounter little stickers saying “we will no longer sell this brand because of unacceptable price increases.” The disruption comes as France, too, wrestles with inflation. Increases in food prices, per statistics from the Organization for Economic Co-operation and Development, topped 17% in early 2023 and have since fallen to a still-eye-watering 7.8%. That’s nearly double the overall inflation rate.

But unlike in the US, where grocery-shelf inflation is sometimes as much a product of corporate profit-seeking as a genuine spike in producer prices, the French government has much more power to cap costs. Inflation introduced in 2018 to shore up farmer incomes means food companies and retailers have to negotiate how much prices are going to go up. But commodity price jumps stemming from Russia’s war in Ukraine threw a wrench into those discussions and forced renewed talks earlier than usual.

That power is not absolute, though, which can sometimes leave retailers stuck between supplier profits and a hard place. When France secured pledges from 75 companies to cut prices last June, finance minister Bruno Le Maire doubled back in August to tsk-tsk a grip of firms, including PepsiCo, for not keeping their word. But it looks like Carrefour has dragged Pepsi back to the negotiating table.

In a statement shared with Reuters, PepsiCo said that “we’ve been in discussion with Carrefour for many months and we will continue to engage in good faith in order to try to ensure that our products are available.”

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Copyright for syndicated content belongs to the linked Source : Quartz – https://qz.com/french-grocer-carrefour-says-non-to-pepsico-price-hike-1851141704

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