Pepsi and Lay's Removed from European Shelves Amid Price Hikes in France

06 Jan, 2024

Carrefour, a prominent French supermarket chain, is ceasing the sale of PepsiCo products due to escalating prices, adding to the ongoing disputes between retailers and suppliers.

Shelves now display a notice alongside affected items, including Pepsi, Lay’s chips, Quaker cereals, and Lipton teas, explaining the discontinuation due to "unacceptable price increases." Once the existing stock is depleted, these products will not be replenished.

This decision extends beyond France, as Carrefour plans to remove PepsiCo products from stores in Italy, Spain, and Belgium. The company's motivation stems from a prolonged dialogue with PepsiCo over the past months, emphasizing its commitment to ensuring fair pricing and product availability.

Carrefour's strategy includes efforts to pressure major consumer goods companies to lower prices, particularly in response to heightened costs in energy, commodities, and labor over the past two years. This move follows reports in September about Carrefour's "shrinkflation" campaign, where products were labeled with warnings about reduced sizes but increased prices.

Despite falling prices in food commodities such as cereals and sugar, Carrefour's CEO, Alexandre Bompard, contends that consumer goods companies are not cooperating in reducing prices. The UN Food and Agriculture Organization's food price index for December 2023 showed a 10% decline compared to the same month in 2022, and a nearly 14% decrease for the entire year, reflecting a downturn in overall food prices. The situation underscores the complex dynamics between retailers and suppliers amid evolving market conditions.

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