Current Affairs Cost of living…

[Daveysgingerlovechild]

I'm sure there is some profiteering going on, but it's not quite that simple. Supermarket brands have such a low margin for manufacturers (often below or at cost) that they need to increase the margin on their own brands to compensate for the loss of margin.

The way it works is a supermarket approaches the company and tell them "make me x product for y pence per unit" and I can tell you from experience that it is almost impossible to meet the required pricepoint, but if you don't do it, your competitors will.

So because you are making zero margin on supermarket brands, you simply have to make the margin on your own branded products.

The supermarkets also dominate the possibility retail landscape so suppliers / manufacturers have no real option but to sell to them.

It's not new, been happening the last 25 years at least, but it becomes more noticeable in times of crisis.

Food tsar blames shortages on UK’s ‘weird supermarket culture’

Henry Dimbleby says suppliers struggling with rising costs while locked into fixed-price contracts

www.theguardian.com

For anyobe intersted its also worth nosing through a few books, albeit old now, but still a good analysis of market failure and the food and supply chain - Tescopoly, Not on the Label, and Captive State: the corporate takeover of Britain.

 

[Kurt.]

Simply grow your own trains

*fixed

 

[summerisle]

Never tried beans from the Asda, might now.

Beans need not mean Heinz: Asda wins Which? taste test

News that cheaper supermarket options can be tastier will please cash-strapped shoppers

www.theguardian.com

 

[WA Toffee]

Maybe I am dead thick. But if I make baked beans or soup for a living under a trusted brand, why would I make an own brand version for someone for zero margin?

Because someone has to.

If I don't make it, my competitors will and they will then have economies of scale, spread out their risk, keep people employed, build better relationships with the supermarkets (the only people than can actually buy your product)

If I don't make it, I only make products for 10 hours a day instead of 20. That's an entire shift I have to make redundant, and I now only have 10 hours production per day instead of 20 to recover all overheads (rent, office staff, marketing, R&D etc etc). So while it may be zero margin, it does cover overheads.

I'm sure an accountant could explain it better than me though

Also worth noting that while single ingredient items like sugar, milk, flour etc are exactly the same - it is literally just a label change - the more ingredients in a product, the more the recipe between the two changes. Supermarket brands may only have 40% beans and 60% sauce where a premium brand will be the other way round. The supermarket sauce also has more water so is filled with thickeners and flavour enhancers to keep costs down.

 

[spectateur]

Maybe I am dead thick. But if I make baked beans or soup for a living under a trusted brand, why would I make an own brand version for someone for zero margin?

As WA Toffee pointed out they have to.
It's not new, in the late 1970s when UK made things, a Leicester knitwear firm sold more than half its production to M+S, NHS, Littlewoods etc at marginal profit. They had to sell their own esteemed brand at a much higher price than the chain stores. Otherwise the factory would have been on short time.

 

[ArtetaMoney]

Energy bills are to come down by 20% over the next few months, according to Martin Lewis. They'll still be extortionate, but I suppose it's a start.

 

[mahermi1]

Energy bills are to come down by 20% over the next few months, according to Martin Lewis. They'll still be extortionate, but I suppose it's a start.

Just like Black Friday really though isn't it, my dual fuel bill with Octopus energy, was £174 last month, this month it's £304. Sorry for harping on about it but I'm using it as an example, so if they take 20% off £304 is roughly £243 that's still a pretty big rise. Just like Black Friday, put the prices up a few weeks before it, then Black Friday put them back down..

 

[ArtetaMoney]

Just like Black Friday really though isn't it, my dual fuel bill with Octopus energy, was £174 last month, this month it's £304. Sorry for harping on about it but I'm using it as an example, so if they take 20% off £304 is roughly £243 that's still a pretty big rise. Just like Black Friday, put the prices up a few weeks before it, then Black Friday put them back down..

Yeah mate, you can see what they're doing. Giving back a small slice to extend this massive profit run which they're on. Our bills have rocketed and we use nowhere near as much energy as we once did, it's criminal really.

I am looking forward to a bit of respite though, I feel like the majority of the spare cash we once had as a family has been swallowed up in this cost-of-living crisis; looking forward to getting some of it back.

 

[mahermi1]

Yeah mate, you can see what they're doing. Giving back a small slice to extend this massive profit run which they're on. Our bills have rocketed and we use nowhere near as much energy as we once did, it's criminal really.







I am looking forward to a bit of respite though, I feel like the majority of the spare cash we once had as a family has been swallowed up in this cost-of-living crisis; looking forward to getting some of it back.


I'm looking forward to revenge at the polling station, the Tories should have taken much more action against these profiteering swine, but obviously didn't want to upset their paymasters.

 

[Baines' left foot]

Heinze have put everything up.
Profiteering Scum.

Another thing Heinz do which is scummy.

Have you ever noticed that you can't stack Heinz cans on top of each other properly, yet you can with pretty much any other canned product out there?

Apparantly it's by design so that Heinz products have to be stacked horizontally, hence taking up more space on the shelves, and less space for their competitors.

 

[DualityNSNO]

Another thing Heinz do which is scummy.

Have you ever noticed that you can't stack Heinz cans on top of each other properly, yet you can with pretty much any other canned product out there?

Apparantly it's by design so that Heinz products have to be stacked horizontally, hence taking up more space on the shelves, and less space for their competitors.

Noticed that.

We did a big shop recently and got a few Heinz cans - shocked to come home and they don't fit on top of each other on the pantry.

I tried and they fit on top of just about any other canned item fwiw lol Just makes for an unsatisfactory OCD stack, but it's doable unless you've bought 50 cans I suppose.

 

[peteblue]

Another thing Heinz do which is scummy.

Have you ever noticed that you can't stack Heinz cans on top of each other properly, yet you can with pretty much any other canned product out there?

Apparantly it's by design so that Heinz products have to be stacked horizontally, hence taking up more space on the shelves, and less space for their competitors.

Noticed that.

We did a big shop recently and got a few Heinz cans - shocked to come home and they don't fit on top of each other on the pantry.

I tried and they fit on top of just about any other canned item fwiw lol Just makes for an unsatisfactory OCD stack, but it's doable unless you've bought 50 cans I suppose.

here you go….

 

[DualityNSNO]

here you go….

View attachment 206107

Thanks mate, but you try it first lol

 

[Mr. White]

Yes it is.

You didn’t write the definition clearly as you don’t know it.

Profiteering is not limited to pricing of goods which can only be attained from that company. Profiteering can simply be seeking to make excessive profits.

Some of the costs being levied by these brands are well above the increases in input costs, therefore it’s profiteering.

No. You are wrong. It's market forces, it's supply and demand...

Is anyone being forced to buy Heinz branded Ketchup/Baked Beans, when supermarket own brands are just as accessible, and far, far cheaper?

And, what are 'excessive profits'?

 

[Brennan]

No. You are wrong. It's market forces, it's supply and demand...

Is anyone being forced to buy Heinz branded Ketchup/Baked Beans, when supermarket own brands are just as accessible, and far, far cheaper?

And, what are 'excessive profits'?

Irrelevant.

Please don’t argue what words mean when you’re ignoring the literal definition to suit your argument.