The food industry has launched an attack against supermarkets, accusing them of unfair competitive practices, while the private label market continues to grow.
Promarca, a Spanish association that includes large companies such as Coca-Cola, PepsiCo, Danone, Camofrio, Calvo, Elpozo, Heineken and Pescanova, among others, denounced the distribution sector for removing thousands of products from its shelves in the past six years. .
According to Promarca, supermarkets removed 3,666 product references from traditional manufacturers, while introducing 1,818 new products from their own brands, ElEconomista reports.
Recently, Carrefour removed PepsiCo group products from its stores under the pretext of unjustified rise in prices. Dia, owner of Minipreço, has done the same with Bimbo products. Mercadona has also removed Leche Pascual from supermarket shelves.
Ignacio Laracochea, President of Promarca, stated that this practice is widespread and that supermarkets seek to increase commercial margins, which limits consumers' access to traditional products and reduces diversity in the market.
Counselor Kantar prepared a report for Promarca in which he confirmed these allegations. The data shows that the range of products from manufacturers in supermarket chains has decreased by 23% since 2019. Mercadona reduced 45% of manufacturer references, Dea 42%, Aeroski 31%, Alcampo 23%, Carrefour 20% and Lidl 14%.
Laracochea warned of economic consequences, such as factory closures and job losses, as well as higher prices for consumers. Promarca claims that distribution applies up to three times profit margins on its own brand products.
A report prepared by the Brattle Group for the association indicates that if these discriminatory practices were eliminated, product prices could decrease by up to 19%.
As a result of the reduced supply of products from traditional manufacturers, private label brands are gaining more space on shelves and gaining a larger share of the market. The weight of private labels in consumption rose from 38.5% in 2021 to 43.7% in 2023, according to Kantar data, and to 48%, according to NIQ. For example, Mercadona ended 2023 with a 74.8% share of its brands in total sales.
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