Carrefour, a major French retailer, has stopped selling PepsiCo products, including Pepsi, Lay’s crisps, and 7up, due to unacceptable price increases. From January 6, 2024, shelves with PepsiCo products at Carrefour stores in France, Italy, Spain, and Belgium will carry signs saying the store will no longer be stocking the brands “due to unacceptable price increases”.
The U.S. company said in October 2023 that it planned “modest” price hikes this year as demand held up despite rises, leading it to hike its 2023 profit forecast for a third straight time. Over the past year, grocery retailers in several countries including Germany and Belgium have announced they stopped a tactic in price negotiations that have become more fraught due to inflation.
It is unclear whether PepsiCo products already on Carrefour shelves will be withdrawn, the spokesperson said, adding it cannot stop shoppers from buying those on display. The signs would only be put up in Carrefour’s stores in France, the spokesperson said, confirming local media reports. Carrefour has been one of the most active retailers to challenge big consumer products and food.
Other Retailers Who Dropped Pepsico Products Due to Price Hikes
Several retailers have taken similar actions to Carrefour in response to PepsiCo’s price hikes. However, the specific details of other retailers dropping PepsiCo products due to price increases are not readily available in the provided search results.
It is important to note that the decision made by Carrefour is part of a larger trend of retailers pushing back against price hikes by consumer goods companies. This has led to a more tense environment for price negotiations between retailers and consumer goods firms in various countries.
While the exact list of retailers dropping PepsiCo products is not provided, it is clear that Carrefour is not the only company taking such measures in response to price increases by PepsiCo.
Price Hikes Have Harmed Pepsico’s Sales
PepsiCo’s sales volume has been affected by the continuous price hikes the company has implemented. Despite beating revenue expectations, the price increases have led to a drop in demand for its products.
For instance, sales volume across several brands was down, with demand dropping 7% for Quaker Foods North America and 2% for PepsiCo’s North America beverage segment. The higher prices have taken a toll on demand, with sales volumes down 2.5% in the third quarter of 2023.
While the price hikes have helped lift PepsiCo’s profits, they have also led to a decline in sales volume, indicating a challenging balance between pricing and demand.
Reason Behind Pepsico’s Price Hikes
PepsiCo has implemented continuous price hikes to boost its revenue amid slowing demand. The company’s price increases have led to a drop in sales volume across several brands, with demand decreasing by 7% for Quaker Foods North America and 2% for PepsiCo’s North America beverage segment.
Despite the decline in sales volume, PepsiCo has reported higher revenue, with its average prices jumping by double digits. The company’s decision to raise prices is driven by the need to maintain revenue growth, despite stagnant demand, and to offset inflationary pressures.
However, the price hikes have resulted in a decline in sales volume, indicating a challenging balance between pricing and demand.