Heinz products back on Tesco shelves after companies reach an agreement over price hike
Tesco has confirmed that Heinz products such as tomato ketchup, baked beans and soup will be back on its shelves.
The supermarket giant stopped stocking Heinz staples after a dispute over price hikes, however it confirmed on Friday (07.07.2022) that the two companies have reached an agreement and Tesco will start selling the products in store and online again.
In a joint statement the companies confirmed the news, saying they were “pleased to have reached an agreement that will see the full range of Heinz products return to Tesco shelves and online.
“Lorries full of Heinz products including Heinz Tomato Ketchup and Heinz Beanz will hit the road shortly, and Tesco colleagues will be working hard to ensure shelves are filled again over the coming days.”
Heinz products disappear from Tesco shelves over price hike dispute
Tesco shoppers are facing shortages of Heinz products, following a fallout between the supermarket and US brand over rising prices.
Kitchen staples like baked beans, salad cream and ketchup have already left some shop shelves, and are listed as out of stock on the Tesco website.
According to a Tesco spokesperson, the business is not willing to pass on what it considers an “unjustifiable” price hike to consumers.
Data quoted by the Guardian reveals that the price of a 4x400g pack of Heinz Cream of Tomato Soup has risen 40% in Sainsbury’s in recent weeks. Meanwhile a 4x200g pack of baked beans Snap Pots is up 20% in Morrisons.
Heinz tinned baked beans have fared similarly – a 415g can has risen to £1.20 in all major supermarket chains apart from Tesco, which still charges £1, and Morrisons, which charges £1.19.
The supermarket’s spokesperson said: “With household budgets under increasing pressure, now more than ever we have a responsibility to ensure customers get the best possible value, and we will not pass on unjustifiable price increases to our customers.
“We’re sorry that this means some products aren’t available right now, but we have plenty of alternatives to choose from and we hope to have this issue resolved soon.”
The spokesperson also said the supermarket was “laser-focused on keeping the cost of the weekly shop in check” to cushion the blow of the ongoing cost-of-living crisis.
This week, Tesco also announced it would be partnering with free-sharing app OLIO and food poverty and waste charity FreeShare to redistribute 200 million meals within the next year.
While Tesco has positioned itself as the consumer champion in this scenario, some retail experts are sceptical of the supermarket.
Ged Futter, former Buyer at Asda and now Director at retail consultancy The Retail Mind told BBC Radio 5Live that he was unconvinced by Tesco’s justification to reject the price hikes.
“Why is the retailer the arbiter of what [price rise] is justified and what is not,” he said. “When a supplier goes to a retailer with a cost price increase, it’s the last thing they want to do. But they do it because they have to survive.”
In Heinz’s case, Futter said that the company was incurring all of the same inflationary problems relating to food manufacturing, plus the higher energy costs associated with making its own cans.
Futter added that he expects the price hike to be accepted by Tesco in the coming weeks. He said: “I imagine this will be resolved within the next couple of weeks. The amount of space for Heinz products is enormous and Tesco can’t afford to have metres and metres of empty space on their shelves for weeks.”
In response to the disagreement, a Heinz spokesperson said: “We are working closely with Tesco to resolve the situation as quickly as possible. In today’s challenging economic environment – with commodity and production costs rising – many consumers are working within tight budgets.
“We always look at how we can provide value through price, size and packs so consumers can enjoy the products they love and trust at a price point that works within their budgets, without compromising on quality. We are confident of a positive resolution with Tesco.”