U.S. Foodmakers Blame Wal-Mart for Stunted Prices

[Freddie Stubbs]

SCOTTSDALE, Ariz. (Reuters) - Americans may have noticed that their grocery bills have remained fairly stable, but it may surprise supermarket shoppers to learn that they have retail giant Wal-Mart to thank for keeping a lid on prices.



At an industry conference in Scottsdale, Arizona, this week, makers of foods from cereal to soup lamented the difficulty of raising prices on such household staples when discounters like Wal-Mart Stores Inc. wield so much power over the grocery market.


"Our customers are really slugging it out for retail space, and as long as Wal-Mart and some of the other customers are putting pressure on our customer base, it's going to be a challenging environment for all manufacturers," Campbell Soup Co. Chief Executive Douglas Conant said in an interview.


Bentonville, Arkansas-based Wal-Mart is the world's largest company by revenue and a dominant player in the U.S grocery business. The massive buying-power of the company's Supercenters, a retail format more than twice as large as its regular discount stores, means Wal-Mart can often buy and sell goods more cheaply than competitors.

more: http://story.news.yahoo.com/news?tmpl=story&cid=1896&ncid=1896&e=9&u=/nm/20040218/us_nm/food_prices_dc_2

[girl gone mad]

1. My grocery bills..

have been going up.

[lcordero]

2. This whole article is a LIE

My monthly food bill has gone up 50% and I have been buying substantially less food.

[Lindsay]

3. My grocery bills have remained about the same

but I have been much more conscientious about buying things on sale.

Food prices have definitely been going up. (Including prices on Campbell soups!)

[w4rma]

4. Are manufacturing costs rising or are they wanting larger profit margins?

If manufacturing costs on food are rising, why are they rising? What is costing more now than before?

[bobbieinok]

5. while living in IA, I began to believe that food prices always go

up, never down, and rarely stay the same for very long

and the farmer's share stays the same amount, ie. becomes an ever smaller percentage of the increasing total cost

[aneerkoinos]

6. Energy

Energy is the biggest single factor, and energy prices show up in crops, packaging and trasportation. As dollar keeps going down OPEC has pegged oil at 24 euros from 2001 onwards. So from 2001 the price of barrel in dollars has gone from about $20 to $30, ie. inflated by one third. This year $40/barrel expected.

[mantis49]

7. What stability?

Grocery shopping can make me ill some times. Especially meat, and I won't shop for my groceries at WalMart. The WalMart here carries Tyson chicken and pork, and I refuse to support them! I try to buy local meat and chicken, but it isn't easy. We've already lost a grocery store in my town since the super WalMart opened.

The prices keep going up.

[loftycity]

8. The smaller manufacturers are taking a big hit

The big fortune 500, they'll be OK. The smaller companies selling to Wal-Mart, are having a very hard time. Wal-Mart is insisting that manufacturers start using radio tagging for shipments. The tagging is a tracking mechanism going from the manufacturer to receiving of products at the Wal-Mart warehouses.

And, no big surprise that only two companies make these radio tags for vendors of Wal-Mart. This is going to cost these smaller companies a fortune.
Of course this will put plenty of companies out of business. Since there is nowhere to sell enough products to keep business going. Just like the middle class the middle tier stores are gone.
(oh how I wish we still had the old retailers around)
Pretty soon we will be shopping at one store. I'm sure you have noticed that your selection is less when you grocery shop. Basically, you are buying products from the same company they have bought up the brand names. So, you believe that you are buying something different when you are not.
It is all so right wing.