In Germany, grocery stores refuse to sell overpriced products

Grocery stores in Germany refuse to sell overpriced products

UPDATE DAY

Finding your favorite brand of cereal or tea in German supermarkets is no longer easy: faced with price increases imposed by food multinationals, some distributors prefer to leave the shelves empty . 

“Dear customers, we are sorry to inform you that you will not find our supplier's products”. It is more and more common to come across this type of poster while shopping in Germany.

The reason: the refusal of certain brands to pay more for certain products from large food groups, sometimes requiring up to a third increase.

Supermarkets are defending purchasing power, multinationals are pleading for soaring manufacturing costs, especially energy.

300 Mars products

The standoff between the food giant Mars and the REWE and Edeka supermarkets, the two largest German chains, is emblematic.

The two brands have given up 300 products from the American group, manufacturer of famous chocolate bars, Twix or M&M's confectionery but also Ebly cereals, Whiskas or Royal Canin pet food.

“Many international brands are trying to take advantage of inflation to charge excessive prices in order to increase their profits,” an Edeka spokesperson told AFP, saying that the Mars request is “not justified. ”.

Mars, in a statement to AFP, invokes the “volatile context, under inflationary pressure”.

“The withdrawal of articles is not new, it happens every year, but this time it goes a little less unnoticed, because Edeka and REWE are affected at the same time,” Thomas Roeb, an economics researcher at the University of Bonn-Rhein-Sieg, told AFP. (west).

On the shelves of Edeka's Berlin stores, packs of animal food, a sector dominated by Mars, are becoming scarce.

In a rival store, the supply of the rice department has been divided by two, for the same reasons.

Jacod and Kelloggs coffee and tea

If the absence of the American group is spectacular, it is far from be the only one.

In some stores, the products of coffee and tea specialist Jacobs Douwe Egberts have disappeared. Danone products have been taken off the shelves at Aldi and Lidl.

REWE is no longer receiving Kellogg's cereal, as the company refused a 30% hike requested by the American group, according to the German press.

A legal battle has even broken out between the beverage giant Coca- Cola and Edeka, which asked the German courts to force deliveries.

In vain: at the end of September, the Hamburg regional court ruled in favor of Coca-Cola, whose products are gradually leaving the shelves of the German group. A call is expected.

“There is a lack of food, drink or even hygiene products,” confirms Leana Kring, 24, when she passes by in front of a supermarket near Karl Marx Allee, an emblematic alley in Berlin.

Historical inflation

These withdrawals come in an already tense context in Germany: inflation is reaching historic highs, with a 10% rise in September, due to the explosion of costs energy.

Beyond the stated defense of the consumer, this crisis is an opportunity for supermarkets to promote their own private label products.

The margins that supermarkets earn on these cheaper products, are much larger.

“Astronomical prices from Mars? So buy Netto,” the low-cost retailer Netto Market Discount, a subsidiary of Edeka, recently highlighted in an Instagram post.

In the REWE supermarket at Friedrichstrasse station, in the heart of from Berlin, we can already see that “Ja” cereals, the group's brand, have replaced the famous Kellogg's.

Products from distributor brands are increasingly popular with Germans, who are azimuths, to save money.

“It’s cheaper, and it tastes the same,” Mirjam Branz, a 30-year-old Berliner, told AFP after shopping.< /p>

The share of these brands in the sector's turnover thus climbed by 1.2 points over one year in the first quarter of 2022, according to the GFK institute.