2024-01-08 05:48:00
Franchises, social plans, new brands, market under tension: 2024 promises to be tough for mass distribution, “their survival in danger”
And if there is one sector where we have felt a sharp increase in prices, it is in mass distribution. Shopping has never been so expensive, and many Belgians have changed their consumption habits, particularly by turning to white goods and private labels. In 2024, some hope to see prices drop for certain products, others are only counting on stabilization. For its part, Test Achats published these monthly figures this week. If things go in the right direction, the increase will continue slightly and approach 29% in two years. “When we analyze inflation over two years, the figures are dizzying,” reacted Julie Frère, spokesperson for Testachats. Basic products such as vegetables have increased by more than 40%, while bread, a basic necessity product par excellence, has increased by more than 20%.”
To know what we should expect, it is interesting to take a look at the current situation in France. If the annual negotiations take place in September and October in Belgium, this takes place in January on the other side of the border. The situation is also tense between suppliers and distributors. We think in particular of Carrefour which stopped the sale of certain products, to protest against increases considered unjustified. A situation which also has an impact in Belgium, at Carrefour, particularly for Pepsi products. “In-depth discussions with PepsiCo have led to the conclusion that the prices the company wishes to charge are not acceptable to Carrefour. Despite numerous attempts to reach a fair agreement, no agreement has currently been reached between the two parties,” the sign said this week.
Bruno Colmant’s economic forecasts for the year 2024: “I am not pessimistic, but be careful of the political blockage in the country”
At Colruyt, we have also been entitled to this type of announcement in recent months, proof that the price war is well underway. So what about the year 2024 in terms of our purchasing power? CEO of Gondola, Pierre-Alexandre Billiet gives us his analysis. “Prices will continue to increase very slightly or be stable. But we expect a promotions war between the big brands, he analyzes. So this is good news for the consumer’s wallet. In the short term, we can instead count on disinflation in mass distribution. Almost all products are affected, both food and non-food. Only geopolitical or climatic crises can increase the prices of household appliances and electronics on the one hand and food on the other.”
For his part, Claude Boffa, professor emeritus of marketing at the Solvay Brussels School, is more cautious. “Prices rarely drop,” he says. Especially since we are still expecting some small effects of inflation, with prices set to increase further. For example, some cut back on their margins at the height of the crisis so as not to increase prices too much and will do so in the coming months, little by little. There is also always a time lag between a crisis and price increases, particularly during negotiations between distributors and suppliers. But everything should settle down if there is no new global crisis.”
An analysis of the annual negotiations which echoes the words of Michel-Édouard Leclerc, boss of the supermarket chain of the same name, who pointed the finger at those who took advantage of the crises to explode their prices, in several interviews granted to the media French. “Michel-Édouard Leclerc is always right, for his own brand, intervenes Pierre-Alexandre Billiet. That is to say that the store that wants to be the cheapest – Leclerc, in France – will do so to the detriment of the food industry. In general he is wrong: the exaggerations of a tiny part of (large) suppliers are melting like snow in the sun. These remarks are therefore populist, capitalist (it is the race for the monopoly of a single distributor) and a danger for public health, because we are faced with hyperdependence on an actor who cuts prices, instead of increasing them. the quality. We know that food quality is under pressure, and other players are working on it such as Carrefour which is going to ban 80 additives from its entire range, or Delhaize which is working on the Nutri-Score.”
Carrefour Belgium in turn withdraws several brands from sale “due to unacceptable price increases”
The news is therefore rather good, but, more than ever, consumers will have to monitor the prices but also the quality of the products they buy, to find the right balance.
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