As I See It
Marmite war may be food & drink to independents
Tesco and Unilever are locked in a row over the latter’s demand for price rises following the slump in sterling.
Tesco’s refusal to buckle means that some products, such as Marmite, Persil and Pot Noodles, will not be available online.
While Tesco is at the forefront of this dispute, all the supermarkets are affected. Tesco has chosen to go public, and some commentators have suggested that this might even be a deliberate move to blame the suppliers for price rises that were already inevitable.
The discounters may not be immune from the fall in sterling, though they could benefit by sourcing more than 60% of their stock from lesser known brands.
This is also where independents will be keeping a close eye on developments. Most expect the row to be resolved quickly because it is in neither party’s interests that it is prolonged. But should it drag on, or Unilever lose the argument, then alternative suppliers may get a look in.
Already the smaller producers are pushing at an open door, especially in speciality foods and in craft beers. Consumers are demanding a wider choice and local produce and this row might play further to calls for more of the same.
This would represent a turnaround in fortunes for independents who not so long ago feared they would be squeezed out in the determination of the supermarkets to drive prices down and focus on big branded products that they know will fly off the shelves.