US retail juggernaut Wal-Mart has said that, where possible, it has blocked attempts from suppliers to raise prices.
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“When our grocery suppliers bring price increases to the table, we don’t just accept them, and increases do not necessarily show up in the retail price,” a spokesperson for the company told just-food last night (29 May).
The world’s largest retailer is able to use its immense buying power to obstruct food manufacturers attempts to raise prices in order to offset rising commodity and energy costs.
“If market conditions, federal, state and local laws or regulations drive costs up, we remain committed to being the price leader in every community we serve,” the spokesperson said. “We aim to be, wherever possible, the first to lower prices and the last to raise them.”
According to research from the Food Marketing Institute, US food prices increased 4% in 2007, the largest increase in 17 years. Moreover, the FMI has predicted that food prices will rise between 3% and 4% in 2008.
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By GlobalDataEarlier this month, Wal-Mart said first-quarter profits rose 6.9% to US$3bn. Overall revenue totalled $95.3bn, up 10.3%.
“At Wal-Mart, we’re committed to saving people money so they can live better. In today’s economy, our customers are looking to us to be an advocate and find solutions that save them money on their groceries,” the spokesperson said.
