UK retail customers are in for a spell of 'price rise poker', as suppliers game the uncertainty and volatility surrounding Brexit
A media storm erupted when familiar products such as Marmite and Hellmann's mayonnaise temporarily disappeared from Tesco's online stores, after the manufacturer, Unilever, imposed a 10% price increase which Tesco refused to accept. Unilever said the increase was necessary because of the fall in the value of the pound after the EU referendum, while Tesco countered that it was unjustified because many of the products in question were made in the UK.
But pundits warn that similar arguments are taking place across the food industry, and are not confined to giants such as Tesco and Unilever. In fact small businesses could be hit harder, and be less well placed to weather the storm -- or face down threats from big suppliers.
The online food magazine Foodnavigator reports a Food and Drink Federation poll that found almost a third of food SMEs to be 'much less confident' about the trading environment since the EU vote. Foodnavigator comments that the sector should prepare for a phase of 'price rise poker', as manufacturers both pass on costs and try to capitalise on uncertainty.
Published Friday 14 October 2016
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