Pantry Price Wars: Heinz ‘Meanz’ Business In Tesco Dispute
As the cost-of-living crisis continues to impact households across the UK, consumers are focused on getting the best prices on essential items.
Grocery stores are pushing strong messaging around value for money as the Big 4 are feeling pressure from German discounters, Aldi and Lidl.
Essential pantry items like beans and soup are a favourite cupboard staple for many, the Heinz brand being a UK favourite.
Yet the brand’s most iconic products may not be found on the shelves of the UK’s leading supermarket, Tesco, due to a dispute over pricing.
Kraft Heinz and Tesco are reportedly at loggerheads over a price increase with the supermarket blaming the manufacturer for upping its prices to “unjustifiable” levels.
Kraft Heinz has temporarily stopped supplying Tesco with its products due to the disagreement but the manufacturer has stated that it is a situation the business wants to ‘resolve quickly’.
Tesco in return has reportedly refused to accept the price spikes which means for now a disruption to the product stocks in store.
“With household budgets under increasing pressure, now more than ever we have a responsibility to ensure customers get the best possible value, and we will not pass on unjustifiable price increases to our customers.
“We’re sorry that this means some products aren’t available right now, but we have plenty of alternatives,”a Tesco spokesperson explained.
Supply chain pressure has been exacerbated with the perfect storm of challenges, impacted by rising production costs, increased consumer demand and the ongoing war in Ukraine.
It is not the first time that Tesco customers have seen famous brands disappear from the shelves. In 2016, Unilever brands including Marmite and Pot Noodle were removed from sale when the organisation put up prices blaming the depreciation of the British pound post Brexit. The dispute was quickly resolved in a private agreement after share prices for both Unilever and Tesco felt the impact.
Yet compared to 2016, more consumers than before are swapping to own-brand labels to counter-balance rising food costs. Supermarkets have added substantially to own-brand collections to appeal to price sensitive shoppers.
A further development since 2016 is the fact that Kraft Heinz have launched a D2C (direct to consumer) offer ‘Heinz To Home’. This is a subscription service selling bundled branded products to UK households. The company says it will continue to add to the selection of products available through this offer.
For many shoppers, the convenience of having their favourite products available in store as part of the weekly shop will be preferable …which is why the grocer and manufacturer will be keen to find an agreement.
” We are confident of a positive resolution with Tesco” a Kraft Heinz spokesperson said.