Part of Guangzhou retail enterprises report 10% price increase for the two brands of Sedal and Lux
Unilever, which was fined RMB 2 million last month, has raised prices. Starting yesterday, many retail enterprises in Guangzhou reported receiving notices of price increases for Sedal and Lux.
Regarding the issue of price, Unilever did not respond yesterday.
Report by correspondents Lin Xiaoli and Huang Pei: Yesterday, a consumer tipped off our newspaper that they found some shower gels including Sedal and Lux have increased in price at a well-known supermarket. Subsequently, the reporter confirmed with the supermarket, and relevant persons in charge admitted that the prices of these two brands indeed started to be adjusted from yesterday. Moreover, many retail enterprises in Guangzhou also expressed that they received price increase notices for these two brands, which both belong to Unilever.
Some supermarkets: Brand manufacturers request price increases
Didn't they say they wouldn't raise prices? But I just saw in the supermarket that the shower gels under Unilever's Sedal and Lux have increased in price, and the increase is not small. Miss Chen, who has always been a fan of these two brands, saw in the newspaper last month that Unilever announced no price increase, but yesterday she found that related products in the mall had increased in price. Is it the manufacturer increasing the price or the supermarket itself? Miss Chen questioned.
After receiving the tip-off, the reporter immediately rushed to the large supermarket. The reporter learned that many shower gels and shampoos of Sedal and Lux have increased in price. Relevant persons in charge of the supermarket also admitted that the related products indeed started to increase in price from yesterday, with an increase of about 10%, and this price increase behavior was required by the brand manufacturer. These varieties were originally planned to be adjusted on April 1 this year, but later Unilever issued another notice, delaying the increase until today.
And the retail enterprise receiving the price increase notice is not only this one. The reporter learned from a well-known department store in Guangzhou yesterday that suppliers of Sedal and Lux and other brands have already sent letters, with an increase of more than 5%, involving some products. Some department stores also indicated plans to increase prices next month.
However, major supermarkets such as Jusco, CR Vanguard, and Carrefour all stated that they did not receive any price increase notices for these two brands.
Unilever: No response to price issues
According to an insider, at the end of March, the National Development and Reform Commission (NDRC) met with four giants - Procter & Gamble, Unilever, Liby, and Nais in Beijing, hoping that companies would not easily raise prices.
Subsequently, relevant personnel from the NDRC flew to Shanghai to negotiate with Unilever, and the company then committed to postponing the price increase on April 1. However, the NDRC eventually issued a fine of RMB 2 million to Unilever for spreading information about price increases and causing panic buying in some places.
Moreover, Zeng Xiwén, Vice President of Greater China Region and spokesperson for Unilever, was criticized by name for giving interviews to the media.
Why did you dare to increase prices again after more than a month? Yesterday, Unilever told reporters that regarding price issues, the company could not provide any information.
It seems that the previous fine imposed by the NDRC on Unilever made the company too sensitive to price issues. An insider said. This person pointed out that what Unilever committed to at the time was to temporarily postpone the price increase plan, not to never increase prices in the future. And daily chemical products are independently priced by enterprises, being a completely fully competitive market. As long as the reasons for the price increase are sufficient and reasonable, the NDRC cannot forcibly require enterprises not to raise prices.
Industry: Cost pressure forces price increases
Yu Xueling, Secretary-General of the Guangdong Daily Chemical Chamber of Commerce, said that the rise in international oil prices triggering an increase in raw material costs in the daily chemical industry is already an undeniable fact. However, enterprises have been unable to digest the 20% increase in logistics and transportation costs. In the past, enterprises could shift costs through methods like launching new products, but now once the barcode needs to be changed, the supermarkets consider it disguised price increase, making this method unworkable.
However, the reporter learned from multiple retail enterprises in Guangzhou that many daily chemical brands that originally planned to increase prices between the end of March and mid-April suspended their price hikes after the NDRC’s talks, without making any public announcements, and have not adjusted prices to date. Even P&G, referred to by the media as the "missed fish," has shown no signs of recent price increases for its daily chemical products.
Yesterday, Xu Xiaodong, spokesperson for Liby, told our newspaper that since committing to not raising prices, there have been no price adjustments for its products. Meanwhile, P&G continues its usual style of not answering calls from the media, providing no response.
An industry insider said that the reason why shampoo and shower gel have become the main items for price increases is mainly because the market share for laundry detergent is more concentrated, mainly in the hands of the four giants, while the markets for shampoos and shower gels are still relatively scattered, and there will be no suspicion of monopoly or price manipulation.
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Dietrich Weaver, President and CEO of Greater China for Nestlé (China) Ltd.
Nestlé has no plans for a price increase in the near future
DONGGUAN, our correspondent Liu Jun (intern Li Zhimin) reported yesterday that the world's largest food group, Switzerland's Nestlé, announced the completion of a new production line for Maggi soy sauce and laid the foundation for expansion projects. During the ceremony, Dietrich Weaver, President and CEO of Greater China for Nestlé (China) Ltd., accepted an exclusive interview with our reporter and stated: Nestlé has no plans for a price increase in the near future.
No plans for price increase after communicating with the NDRC
The world we live in now, the prices of commodities have gone a bit crazy. In response to our newspaper's question about how to view the significant fluctuations in commodity prices in recent years, Dietrich Weaver summarized as such. He said that there are several reasons for such a large increase in prices. First, China, India, and other emerging countries have a huge demand for commodities. Demand keeps growing and exceeds supply.
He said secondly, it's due to speculators' trading. Some speculators aim specifically at these goods; 30% to 40% of some raw materials' output has been taken up by speculators, benefiting a few people while harming the majority.
Dietrich Weaver believes thirdly it's biofuels, land used for crops is getting less and less. For example, in the U.S., 30% of corn is used to make biofuel, but the total planting area in the U.S. hasn't increased. That means 30% of the land isn't providing food for people.
In the recent period, the National Development and Reform Commission frequently held talks with industries such as daily chemicals, white wine, and infant formula to stabilize commodity prices.
In response to this, Dietrich Weaver said: We have adopted various methods to control product prices. He said that Nestlé tries not to raise prices or minimizes price increases as much as possible. We have communicated with the NDRC, and Nestlé has no plans for a price increase in the near future.
Dietrich Weaver revealed yesterday that last month Nestlé had announced the acquisition of 60% equity in Yinlu, and currently, this cooperation project has been submitted to the Ministry of Commerce for approval. If the approval passes, there will be more detailed development plans with Yinlu.