High inflation has left many consumers unable to afford essential products, Carrefour CEO Alexandre Bompard says. He points the finger at brand manufacturers.
“Multinationals can increase margins”
The French are experiencing a “tsunami of deconsumption”, Bompard told franceinfo: “When the essential is no longer accessible, when people cannot afford essential products, we have to act quickly“, he says. He is therefore asking French Economy Minister Bruno Le Maire for a moratorium on the application of the Descrozaille law, which restricts promotions on hygiene products in particular from March 2024.
“Today I can sell a detergent with a 50 or 60 % discount, but once that law is applied, I will have to limit myself to 34 %.” According to the CEO, that law will benefit only three multinationals, namely Procter & Gamble, Henkel and Unilever: they will be able to increase their margins while up to one in five French citizens will have to deny themselves basic care and hygiene products.
“Consumers turn away from brands”
The CEO has some serious accusations in store: “The French have understood that manufacturers and national brands were not on their side”, he states. With that, he referred to reports that – according to him – have shown that multinationals did not simply protect their margins, but actually increased them – even in the context of inflation.
Bompard also claims consumers are increasingly turning away from major brands. At Carrefour this summer, customers removed an average of seven national branded products from their shopping trolleys and replaced them with five private label products, he claims. The CEO also reacted furiously to criticism from French food federation Ania that retailers had not yet passed on all the structural price cuts. That is totally untrue, he says: in an ultra-competitive environment, retailers implement price cuts as soon as they can.
