Mars continues to stubbornly boycott German supermarket group Edeka: neither is making concessions regarding pricing, even though they are both losing hundreds of millions in the process.
Expensive squabble
Edeka and American brand manufacturer Mars are playing chicken in their price negotiations. For more than six months already, Edeka consumers have had to do without Mars chocolate bars and Sheba cat food, and this is not changing any time soon. On the contrary: in its latest leaflet, Edeka Südwest is pushing it by saying “Bye Mirácoli. Hello Delverde.” For the latter brand, Edeka has exclusivity in Germany.
At the root of the conflict are the price hikes Mars wants to implement, which, according to Lebensmittelzeitung, exceed 10 %. Edeka stubbornly continues to refuse, causing 450 products to disappear from its shelves. Indeed, Mars in turn stopped all deliveries – accounting for 300 million euros of Edeka’s turnover to go bust. In fact, the supermarket chain is said to have already removed Mars from its annual schedule.
International escalation?
Conversely, the stakes are also high for Mars: in the pet food category alone, the producer would normally get about a third of its German supermarket sales from Edeka, or some 230 million euros. In fact, the boycott has already caused Mars’ market share to fall sharply, with Nestlé taking over the market leadership. Still, Mars prefers higher prices and profits to sales.
Mars is not only at odds with Edeka: LZ has noticed that its chocolate bars are missing at Aldi Süd, and there were also temporary stock shortages at Rewe. In the Netherlands, the manufacturer currently refuses to supply Jumbo. However, the game becomes extra dangerous now that Edeka and Picnic want to join forces with Système U in France through the buying alliance Everest. If Mars also loses Système U, the company erodes its position in almost all of Western Europe.
