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Inflation and Reduced Consumer Spending Creating Conflict Between Suppliers and Retailers

07/13/2022

Major chains, including Walmart and Target, are resisting price hikes imposed by suppliers.  Although brand loyalty is intensified during periods of short supply, price conscious consumers are now seeking value in house brands.  Some retailers are now curtailing shelf space for national brands in favor of private label equivalents.

 

Conflict over prices erupted when Kraft Heinz restricted the supply of specific products to major U.K. supermarket chain Tesco.  Ultimately the feud was resolved, but the current situation may embolden other chains to resist price increases imposed by packaged food companies and suppliers.