The French supermarket chain Carrefour says it will no longer carry goods by the brand PepsiCo because the company has increased its prices too much. The move comes as France seeks EU approval forcing retailers to better flag "shrinkflation" – when companies reduce the size of product while continuing to maintain its price.
From Thursday Carrefour stores in France have notes on their shelves notifying customers that PepsiCo products – including Pepsi and 7Up sodas, Lay’s and Doritos crisps, and Quaker oats – will no longer be sold due to "unacceptable price increases”.
The notes are accompanied by the message: “Carrefour, committed to lowering prices”.
US-based PepsiCo said in October that it had planned “modest” price hikes in 2024, leading it to increase its 2023 profit forecast for a third time.
Battle lines
Over the past year, grocery retailers in several countries have announced stopping orders from consumer goods and food companies because of price rises, with Carrefour one of the most active.
Last year, Carrefour started posting warnings on products that have reduced in size but have increased in price, known as “shrinkflation”, which is legal, as long as the weight or quantity is indicated on the package.
France also submitted a draft decree to the European Commission that would require supermarkets to indicate variations in quantities of products.
The proposal, which would fall under a 2014 European directive on transparency, is a response to “consumer demand to be better informed” according to French economy ministry.
If the commission makes no comment, the decree will be published in March.
Food prices high in France
A preliminary publication from France's national Insee statistics office show consumer prices in France rose 4.1 percent over the past year.
Food inflation slowed down slightly, to 7.1 percent, from 7.7 percent in November, down from 12.1 percent from the year before.
In efforts to bring down food prices quickly, the government has asked large grocery retailers to wrap up annual price negotiations with suppliers by mid January, a month and a half sooner than usual.
The retailers have expressed concern that this will not give them enough time to negotiate properly.
France's finance minister has threatened to impose special taxes on food companies that have made what he called “undue” profits from rising prices if they did not pass on lower costs to consumers.
(with newswires)
