LONDON: A high-profile pricing spat between supermarket chain Tesco and Unilever, the food manufacturer, has been reportedly resolved, ending a stand-off that had threatened the presence of many Unilever food brands on the shelves of the UK's largest grocer.
Tesco had pulled dozens of Unilever products from sale on its website, including savoury spread Marmite, Persil washing powder and Ben & Jerry's ice cream, amid allegations that the FMCG giant was demanding a 10% price hike.
But news of an agreement between the parties was announced late yesterday afternoon, reported The Guardian.
Details of the compromise were scant, but Unilever said it was "pleased to confirm that the supply situation with Tesco in the UK and Ireland has now been successfully resolved", while Tesco commented that the situation had "been resolved to our satisfaction.”
The row was initially sparked when Unilever said it had been forced to increase prices because of the sharp fall in the value of the pound since a referendum in June decided the UK would leave the European Union.
The pound has fallen 17% since the Brexit vote and Unilever argued that, with many commodities priced in dollars, this was forcing up costs even on products made in the UK, such as Marmite.
Onlookers feared that the argument with Tesco could have escalated because other major retailers, including Sainsbury's and Walmart-owned Asda, were facing similar demands to raise prices and were not happy.
But prior to the deal, Graeme Pitkethly, Unilever's chief financial officer, argued that price rises were a standard response to increased costs. “We are taking price increases in the UK. That is a normal devaluation-led cycle,” he said.
Data sourced from the Guardian; additional content by Warc staff