Dhe customers' wait is coming to an end after more than a year and a half: On Monday, the American food company Mars confirmed to the FAZ that the company had reached an agreement with the supermarket chain Edeka. Mars chocolate bars, Whiskas pet food and Airways chewing gum could soon be on Edeka shelves again.
“It is our interest to work in partnership and successfully with all trading companies,” said a Mars spokeswoman. Edeka said: “The order and delivery times have already been defined for all categories.
It starts with the chewing gum category, which can already be ordered.” The other categories would be phased in step by step. However, the whole process could still take a few weeks.
Hard-hitting arguments
The dispute was considered one of the longest ever between manufacturers and supermarket chains. According to media reports, Mars had demanded a price increase of 20 percent. Before the agreement, there was talk that only around half of all 400 Mars products could appear in stores again.
Both Edeka and Mars declined to comment. One thing is certain: the negotiations were hardly as friendly as the tone in the confirmation email suggests. “The duration of the delisting alone shows how intensively both parties fought with each other,” commented Marian Richter from the management consultancy Boston Consulting Group on the agreement.
Stephan Rüschen, professor of food retail at the Baden-Württemberg Cooperative State University in Heilbronn, sees it similarly: “The willingness to endure long negotiations has increased.” But he sees no winner: “Both sides have suffered from it.”
Sound becomes rougher
Similar to Richter, Rüschen observes that the intensity and frequency of delistings have increased. “Negotiations have become tougher, especially since the Ukraine war,” said Rüschen.
Supermarket chains argue that some manufacturers want to continue to impose price increases even though the costs of energy and many raw materials are falling. The manufacturers disagree: The costs for energy, wages, logistics and many raw materials are still significantly higher than before the Ukraine war. That's why they don't want to lower prices, but rather raise them.
“The truth lies somewhere in between,” said Rüschen. His guess: Prices in Germany are relatively low compared to other countries. This is due to the high proportion of discounters in this country. Among other things, this leads to lower margins for international manufacturers in Germany.
Supermarkets have the upper hand
In recent years, manufacturers have no longer been willing to accept this – and are demanding higher prices than are absolutely necessary. At the same time, according to Rüschen, the supermarkets would only talk about the total profits of international manufacturers when they criticize the manufacturers – and not about the share that goes to Germany.
Management consultant Richter does not see any lower margins for manufacturers in Germany. Nevertheless, he emphasized that the price war is particularly fierce in this country. Ruffles is convinced that supermarket chains generally have the upper hand.
Only a few products are indispensable
The Rewe Group (with Penny), the Schwarz Group (Lidl and Kaufland), Aldi and Edeka (with Netto) account for 85 percent of the market share. Edeka is at the forefront. The higher price-setting power of retailers is obvious for Ruffles: If Edeka does not want to accept Mars' price increase, the supermarket can rely on alternatives.
On the other hand, in contrast to discounters such as Lidl and Aldi, Edeka is more dependent on branded products. “There are only a few manufacturers whose products are indispensable for supermarkets,” says Rüschen. These include brands such as Nutella and Redbull.
But is the power of supermarkets actually reprehensible? According to Rüschen, the position of discounters in particular means that prices for consumers are relatively low. “Although Edeka has a better position compared to many manufacturers, it faces tough competition from other supermarket chains.”
As a result, profits were relatively small in relation to the pricing power. Rüschen is certain: Even if consumers could look forward to Mars bars in Edeka stores again, the price war is unlikely to become less fierce.
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