Is Unilever Biting Off The Hand That Feeds Them?

[anotheoldgit]

http://www.dailymail.co.uk/home/index.html

[anotheoldgit]

Sorry:

http://www.dailymail.co.uk/news/article-3835034/Major-brands-axed-Tesco-shelves-row-supplier-Unilever-demanded-10-cent-price-rise-falling-pound.html

[dannyk13]

It could backfire on them as (according to news last night) three other big supermarkets are following Tesco's example.

[hc4361]

Tesco has stopped a lot of brands such as Aunt Bessie's chips and Rooster potatoes.

[cassa333]

There has always been a precarious relationship between supplier and supermarkets. The supermarkets have slashed profit on a huge amount of products and in the process squeezed the producers and suppliers margins in the process.

The £ having lost a lot of ground has hit hard on import costs and even a big name like Unilever can only take so much. However there is also talk of Unilever putting prices up even of products produced in this country so 50/50.

[Gromit]

No.

Obviously the pound going tits up over Brexit fears means the manufacturer and the seller will have to both take a hit. If Unilever's costs have gone up then they need to pass on those costs. They are a business, not a charity. The supermarket can pass on the costs to customers to decide, but for some reason will not do that. I suspect there is more to this than the Brexit costs, it is about redefining their relationship - supermarkets now like to dictate rather than be dictated to.

There will be people who still want Marmite, so they will go to a supermarket that sells it, so Tesco will lose out.

[ToraToraTora]

plenty of other suppliers out there, they could be losing the supermarkets as I don't think ASDA etc will wear their cobblers either.

[ToraToraTora]

Marmite is made in the UK gromit, why have they put that up? Unilever are anti brexit so they are spitting out their dummy. Perhaps they've run out of sour grapes in the warehouse.

[Old_Geezer]

I don't think either party relies on the other, but both will hurt at a split.
It's a question of who blinks first. Both have arguments in their favour and against. One is using the exchange rate as an excuse to up prices across the board, the other is bullying a supplier telling them what they have to charge or get no access in the store at all. If folk played fair instead of pushing for maximum benefit for themselves and blow everyone else, it'd run a lot more smoothly.

[Gromit]

People want branded products which is why the supermarkets are full of them. Own brands are considered inferior, which is why they have to sell them for less.
As I said, this is about redefining their business relationship. Tesco believe they are all powerful and can dictate what they want to pay. That may work on weak diary farmers and vegetable growers, but a multi-million pound corporation will not just roll over and submit.

[Patsy33]

I see it was spread all over the newspapers this morning.....

[Old_Geezer]

If you have a favourite store you like to shop at I think most will continue to do so, and cut down on the missing products, or try substitutes. Some will change supermarkets but there again some customers chop & change regularly anyway.

[Patsy33]

Both might lose out if people start making their own. PS, how DO you make Marmite??

[Old_Geezer]

http://www.msmarmitelover.com/2011/04/how-to-make-your-own-marmite.html

[hc4361]

TTT, just because it is made in the UK doesn't mean the ingredients aren't imported.

[EDDIE51]

I NEVER buy brand names always supermarket own. You can't tell the difference yet around 1/2 the price. I defy anyone to tell the difference between supermarket own brand yeast extract and Marmite.

[agchristie]

Well, it doesn't look like they will be coming up with the goods :(

[Patsy33]

Thanks for that OG. I think I'll pass on that one! Although there might be some folk out there willing to have a go and could be onto a good thing if Marmite disappears....

[anotheoldgit]

/// There will be people who still want Marmite, so they will go to a supermarket that sells it, so Tesco will lose out. ///

Surely they are only a very small minority, so if Tesco were to lose a few Marmite loving customers, I don't think it would make a huge difference to the thousands of other customers that their supermarkets attract.

[anotheoldgit]

Gromit

/// People want branded products which is why the supermarkets are full of them. Own brands are considered inferior, which is why they have to sell them for less. ///

Only the gullible ones, the more discerning shopper knows that most own brand products are actually made by the same producers of the branded goods.

Or do you think that Tesco, Asda, Morrisons etc, have their own factories producing their own branded goods?

[Gromit]

Unilever own hundreds of established brands.
If Tesco do not want them, then that's OK.
If Unilever do not want to sell them too cheaply then that is OK also.
If the pound crashing means things cost more, then someone will have to pay. Either British jobs or the customer.