Carrefour pulls Pepsi Lays and Lipton from shelves due to.JPGw1440

Carrefour pulls Pepsi, Lays and Lipton from shelves due to high prices

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France-based Carrefour, one of the world's largest grocery chains, told customers Thursday that it is pulling Lay's, Doritos, Lipton teas and other PepsiCo products from the market in protest at increased prices.

Stores in France, Italy, Belgium and Spain were affected, several news agencies reported. Carrefour, which has more than 12,000 stores worldwide, did not immediately respond to The Washington Post's request for comment. On a sign posted in certain aisles in stores, the company announced the decision and said it was “committed to reducing prices.”

A spokesperson for PepsiCo told The Post that the company “has been in discussions with Carrefour for many months and we will continue to engage in good faith to ensure our products are available.”

Carrefour's move comes as Europeans continue to struggle with high food prices. In France, food prices rose more than 7 percent year-on-year in December. According to one estimate, price increases peaked in March 2023 and increased by almost 16 percent.

Retailers in the U.S. have also battled with suppliers to lower food prices. To apply pressure, some stores will put brands in the “penalty box,” said Randall Sargent, partner in the retail and consumer products division of marketing consulting firm Oliver Wyman.

That could mean awkward shelf placement, less advertising and higher prices, which would make the products “less attractive for consumers to buy that brand compared to another brand,” she said.

But in Europe, more aggressive tactics such as withdrawing all products are not uncommon, Sargent said. Grocery stores in the region are smaller and have less noticeable gaps on shelves, and European consumers are already more inclined to buy stores' own brands, she said.

“While consumers are still very loyal to certain national brands, they are slightly less bothered by them being taken off the shelf because they are already used to it and are also more willing to switch to the private label equivalent in many categories,” says Sargent said.

Carrefour awaits According to a strategic plan published in 2022, the company wants to expand its own brand. The company aims for its private label to account for 40 percent of food sales in 2026, up from 33 percent in 2022.

The Wall Street Journal reported that PepsiCo's business in Europe accounts for about 14 percent of its global sales, which total about $9 billion. Given Carrefour's size and scale in the region, the loss of shelf presence will “definitely impact suppliers' business in Europe, if not globally,” Sargent said.