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The boss of Système U warns of “deconsumption in France today”

Food inflation is falling.

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The boss of Système U warns of “deconsumption in France today”

Food inflation is falling. After reaching a peak of nearly 16% at the start of 2023, slowing to 5.7% in January 2024 over one year, it should settle at 1.5% next June, according to the latest economic report from INSEE . Guest of the morning show on BFMTV and RMC this Wednesday, the CEO of Système U gave details on the price reductions expected on shelves in the coming weeks. “All paper-based products will decline, like those made from wheat, pasta in particular,” said Dominique Schelcher. Prices will also be lower on cleaning products, a consequence of the end of mega-promotions ratified by the Descrozailles law. “There will be a little less promotions but the basic prices will fall on everyday products in these departments, up to 5% or more,” assured the manager.

However, the situation remains mixed in supermarkets, which Dominique Schelcher does not deny. “There are about a quarter of products which are decreasing and the rest which have increased very slightly,” he declared, pointing the finger at the role of “multinationals” who have not “enoughly played the game” of declines of price. Among the bad news, the CEO of Système U mentioned the prices of chocolates, which are particularly high as Easter approaches. “Since January 2023, the price of a tonne of cocoa has tripled. Chocolate has already gained 10% last year. This time, we anticipated the Easter chocolate campaign, which made it possible to limit the increases, which are less than 10%. More generally, the manager recalled that France “will not return to prices before” the inflationary crisis, a position shared in particular by the CEO of E.Leclerc Michel-Édouard Leclerc.

Faced with soaring prices, the French have adapted their consumption. “We are in decline in France today,” says the CEO of Système U. “At more than three euros, people no longer buy,” he noted. According to him, consumers are abandoning “traditional fresh products” and limiting their non-food purchases. “I don’t see a reversal trend. On the contrary, since the start of the school year, I have noticed significant drops in volume,” he emphasizes. Customers now favor private label brands (MDD) over major brand products. “The U product is 25 to 35% cheaper, so the French are arbitrating, abandoning the big brands, believing that it is an equivalent product and they are right,” commented the CEO.

In the midst of an agricultural crisis, are distributors right to seek the lowest possible prices? Taking the example of a bottle of wine sold at 1.36 euros, Dominique Schelcher made his difference heard. “This is not a good idea in times of agricultural crisis,” he said, emphasizing that wines “made for the U brand” are purchased “a little more expensively” from winegrowers to “cover their production costs.” production". The CEO of Système U also positioned himself in favor of better transparency of the origin of products, by showing his support for the “Origin Score” project. “Since 2019, we have ensured transparency of origin on U products. We are also improving our recipes so that they include more French ingredients. I am for Origin Score but we are already very committed,” he assured.

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