Leclerc boss warns of price rises in France due to Iran conflict
If war drags on it will have knock-on effects for a range of products, says Michel-Edouard Leclerc
The CEO of Leclerc says the supermarket will be forced to raise prices on some products if the Iran conflict goes on
Harry Wedzinga/Shutterstock
The boss of French supermarket chain Leclerc has outlined which products will likely rise in price in the coming months, warning that tensions in the Middle East are set to have knock-on effects on costs.
Michel-Edouard Leclerc, CEO of the group, told TF1 this week that while supermarket prices are currently stable, rising oil prices linked to the war in the Middle East will soon start to affect the chain of production, namely rises in transport and packaging.
“Today, everything sold in stores was purchased before the conflict,” said Mr Leclerc, explaining that if transport and packaging costs increase, that is reflected in costs for the business, which are then necessarily passed on to shoppers.
“Yes, there will be price increases,” he said. “There will inevitably be repercussions if the conflict drags on.”
This will likely include products that contain plastic made from petrochemicals, such as:
Yet, Mr Leclerc stressed that prices would not spike overnight, and that “there would not be a repeat of the Ukraine situation…where we were asked to raise pasta prices by 38% because part of Ukraine was paralysed”.
He added that the supermarket would “listen” to suppliers and manufacturers if they called for a renegotiation and increase in prices, but “we don’t want to renegotiate everything we’ve just negotiated”, he said.
“We’re not out to kill the little guy, but we also can’t start opening the floodgates [and raise prices that we have already negotiated],” he said.
E.Leclerc is one of the largest supermarket groups in France, and was founded by Mr Leclerc’s father Edouard in 1949. It has developed a reputation for being the cheapest supermarket and being a tough negotiator when it comes to rising prices and the effects of factors such as inflation.
Mr Leclerc always tries to position himself and his brand as “the protector of French people’s spending power”, but he also receives fierce criticism for the vast influence that he and the group have on food prices, farmer pay, and manufacturing trends.
