Carrefour, one of the world’s major grocery chains headquartered in France, has announced its decision to remove PepsiCo products, including Lay’s, Doritos, and Lipton teas, from its shelves in France, Italy, Belgium, and Spain. This move is a response to the company’s protest against increased prices. Carrefour, with a global presence of more than 12,000 stores, made the announcement through signs placed in certain store aisles, emphasizing its commitment to reducing prices.
Despite numerous news outlets reporting on the decision, Carrefour has not provided an immediate response to The Washington Post’s request for comment. Meanwhile, a spokesperson for PepsiCo stated that the company has been engaged in discussions with Carrefour for several months and intends to continue negotiating in good faith to ensure the availability of its products.
This development unfolds against the backdrop of rising food prices across Europe. In France, food prices experienced a year-over-year increase of over 7 percent in December, reaching a peak of nearly 16 percent in March 2023, according to estimates. The struggle with high food prices is not unique to Europe, as U.S. retailers have also been pressuring suppliers to lower prices, employing tactics such as relegating brands to the “penalty box.”
Carrefour’s decision to remove all PepsiCo products is a more assertive approach, a strategy not uncommon in Europe. Randall Sargent, a partner in the retail and consumer goods division of Oliver Wyman, explained that European grocery stores, being smaller, can execute such moves with less noticeable impact on their shelves. Additionally, European consumers are more inclined to opt for private brands, making the removal of national brands less disruptive.
As part of its strategic plan published in 2022, Carrefour aims to increase the share of its private label to 40 percent of food sales by 2026, up from 33 percent in 2022. This move suggests a concerted effort by Carrefour to strengthen its private label presence.
PepsiCo’s business in Europe constitutes approximately 14 percent of its global revenue, totaling around $9 billion, according to the Wall Street Journal. The impact of Carrefour’s decision on PepsiCo’s business is expected to be significant, considering Carrefour’s extensive size and scale in the European region, potentially affecting global operations, as noted by Randall Sargent.
