Renewed tension between distributors and suppliers
What will be the price in the coming months of yogurts, tins of peas or sodas on supermarket shelves? A large part of the answer is played out in the annual negotiations that are currently taking place between large-scale retailers and their suppliers. While this exercise is highly regulated by law, which sets a deadline of 1er March, the negotiations are being held this year in a somewhat unusual climate.
The price and other subtleties
The ups and downs of recent months have often pushed the various protagonists to unite their efforts to maintain supplies to the French by adapting to fluctuating health constraints. Some brands have communicated a lot about the fact that they pay their bills as quickly as possible, in order to protect the cash flow of their suppliers, or on their desire to come to the aid of agricultural producers deprived of other outlets.
No surge in food prices during the pandemic
These outbursts of solidarity seem to have suddenly evaporated since buyers and sellers have returned to the boxes where these negotiations are held behind closed doors. With the challenge of agreeing on the evolution of purchase prices but also on many other small subtleties that make all the difference (place given to a product on the shelf, participation in promotions, penalties for late delivery. delivery…).
While the showdown is in full swing, manufacturers accuse large-scale distribution of seeking to drive prices ever lower, making it impossible to better remunerate agricultural producers. ” It’s getting worse. Increases are systematically refused, even when they are inevitable in view of the increase in the cost of materials ”, takes offense at Richard Panquiault, managing director of Ilec, the organization bringing together multinationals suppliers of star products in the departments.
Will higher prices in supermarkets benefit farmers?
The large distribution, in return, denounces unjustified requests for increases on the part of manufacturers. And points out the lack of guarantee given that an increase will end up in the pockets of farmers. She assumes to accept certain increases, but assumes to refuse many others. ” What is there like agricultural production in Diet Coke? », Quips a store manager.
SMEs better treated
One month from the deadline, supermarkets believe they have made the necessary efforts. ” There are a lot of increases accepted for products with a strong agricultural component, so that farmers can live off their work. Likewise, the brands are very understanding with SMEs, because we know they are fragile. Finally, we take into account the evolution of raw materials », Pleads Jacques Creyssel, general delegate of the Federation of commerce and distribution (FCD) which brings together the big brands.
Carrefour, for example, announces that it has already concluded negotiations with 95% of the SMEs concerned. Indeed, confirms Dominique Amirault, president of the FEEF which brings together many SMEs, “We sometimes feel, but not in everyone, a certain attention to our difficulties”. But, he continues, “The discussion around prices remains as tense as ever. There is still a lot of double talk: on the one hand, we praise quality and proximity, on the other, we refuse to pay SMEs the fair price that would give them the means to develop ”.
The threat of controls
If this little music of discord sounds about every winter at the same time, it still sounds particularly strong this year. To the point that the government decided to raise the tone in an attempt to get everyone in tune during a meeting organized on Friday, January 29. The ministers of agriculture and industry reiterated their determination to uphold the spirit of the Egalim law, passed two years ago, the ambition of which was to better remunerate producers.
Bercy asks for a record fine against Leclerc
In an attempt to make itself heard, the government is emphasizing its desire to increase controls. In recent years, these have sometimes resulted in a few hefty fines imposed on the purchasing groups of the big names in distribution. But, the government does not have all the weapons in these negotiations between private actors. “We are not in an administered economy”, we recognize in Bercy. What a good connoisseur of the sector translates in a more colorful phrase: ” The frowns of a minister will not be enough to push Leclerc to buy more expensive his milk cartons! “
If large food stores had a very good month of December, with sales up more than 10%, their turnover for the last quarter was down 1.4%.
compared to last year according to figures from INSEE. This decline mainly affected hypermarkets, which lost 3.3%, while supermarkets stagnated (up 0.1%).
Driven by the closure of restaurants and teleworking, food sales increased by more than 4%. The turnover in the non-food sector, penalized by the closure of “non-essential” departments in November, is however down 1.7% compared to the previous year. As for the sales of fuels in mass distribution, they collapsed by more than 28%.