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Tesco, Unilever in Brexit price clash

Thursday, October 13, 2016 - 01:28

Britain's biggest retailer Tesco pulls Unilever goods such as Marmite from its website in a pricing row sparked by the Brexit-induced plunge in the pound. As David Pollard reports, it's one of the most vivid signs to date of how leaving the EU could hurt consumers.

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Love it or hate it, hashtag Marmitegate is here. UK consumers taking Twitter by storm because they can't get their breakfast spread online at Tesco. Britain's biggest retailer now in a stand-off with Unilever - its biggest supplier - over pricing. With this pledge coming from former Unilever exec turned Tesco boss. (SOUNDBITE)(English) TESCO CEO, DAVE LEWIS, SAYING: "What I can give you a commitment is, it's not our intention to let prices flow through to retail inflation if it is at all avoidable." A 15% drop in sterling since the UK's Brexit vote has squeezed commodity prices higher - and Unilever profits lower. The Anglo-Dutch firm demanding a ten per cent price hike across a range of big brands - many of those also not available on the Tesco website. (SOUNDBITE) (English) CHIEF INVESTMENT OFFICER, CCLA INVESTMENT MANAGEMENT, JAMES BEVAN, SAYING: "Its current margins are less than two per cent. It has already been investing heavily in making its everyday prices lower. This is only going to make life more difficult .... Simply to say, 'terribly sorry, can't shop here' is a real incentive for people to go to the other online providers, switch loyalty and possibly not come back." Some may wonder where they'll go. Unilever's price demand also, it's thought, extending to Britain's other biggest grocers. This stand-off serving as a possible foretaste of how hard consumers could be hit. As Britain prepares to say 'bye-bye' to Europe.

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Tesco, Unilever in Brexit price clash

Thursday, October 13, 2016 - 01:28