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UK supermarket executives reject accusations of ‘profiteering’

UK supermarket executives reject accusations of 'profiteering' Food and Beverage Business

UK supermarkets are facing accusations of benefiting unduly from inflation, but four major grocers have firmly rejected the idea of price caps. According to the British Retail Consortium, food prices in the UK rose 14.6% year on year in June, a slight decrease from the 15.4% recorded in May.

A hearing organized by the House of Commons Business and Trade Committee provided a platform for the heads of the UK’s major supermarkets to discuss pricing and the future outlook for consumers. Tesco’s commercial director, Gordon Gafa, highlighted that some inflation is a result of structural factors that do not change rapidly, rather than profiteering.

The suggestion of implementing price caps on essential items such as bread and milk was recently raised in the UK media, but the government distanced itself from this idea. During the committee hearing, all four grocers expressed their opposition to price caps, citing the fiercely competitive nature of the industry and the potential negative consequences of such measures.

Sainsbury’s commercial food director, Rhian Bartlett, emphasized that the UK’s food market is already considered one of the most competitive in the world, and imposing price caps would only add bureaucracy without tangible benefits. The French food industry, on the other hand, has agreed to lower prices on basic items starting from next month.

Morrisons CEO, David Potts, concluded that competition is the driving force that leads to fair prices and maintained that the market self-regulates effectively.

Overall, the UK food and beverage industry remains committed to providing affordable and competitive prices to customers, while navigating the challenges posed by inflation and market forces.

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