Is it a bird? Is it a plane? No, it’s Tesco-man, flying to the defence of the British consumer! Worried about inflation? Never fear, Tesco-man is here to battle multi-national super-villain suppliers!
Yes, Tesco chief executive David Lewis is at it again. Having won the battle of the Marmite jar with his erstwhile employer Unilever, Mr Lewis has issued a warning to other suppliers who might be tempted to use Britain’s Brexit weakened currency as an excuse to raise prices. He’s not going to allow it.
Well, he’s not going to allow it unless price increases are “justified”. But, then, Superman only ever fought Lex Luthor when it was justified, didn’t he?
Actually, teasing aside, Mr Lewis has raised a worthwhile point. Multinationals like Unilever are able to manage their businesses to take account of movements in the currency markets.
It is now common practice for them to report adjusted earnings figures designed to show how they would have done had currencies been constant, in addition to providing a raw figure.
Mr Lewis has suggested that suppliers wouldn’t make customers in other countries pay extra for temporary periods of currency weakness, and so the same should be true for Brits. Thanks Tesco-man!
Just one question: What if Brexit induces a long term weakness (highly probable) in the pound? Will that allow Unilever to impose a “justified” price increase in a jar of marmite? Tesco-man doesn’t say.
He doesn’t need to really, because this isn’t solely about Tesco battling suppliers on behalf of its customers.
Call me a cynic, but notice the timing of Mr Lewis’s latest punchy statements. They come just as Tesco prepares for the Black Friday scrum, givng the retailer a nice bit of positive PR momentum leading into it.
Good PR is something Tesco could do with in the wake of the Tesco Bank cyber fraud and with the Serious Fraud Office nearing the end of a long running investigation into the black hole in the retailer’s accounts prior to Mr Lewis joining.
Now would therefore be very good time to remind shoppers of the incumbent chief executive’s super hero secret identity, no?
Personally I’d be a little more willing to believe the Tesco-man hype were Mr Lewis to make some similarly punchy public statements about the subtler ways multi-nationals have been sneaking through price rises, via the deflation in the sizing of their products.
Unlike the change in the headline price of a jar of Unilever's Marmite, pack size changes often fly under the radar. But the effect on the consumer is exactly the same as a rise in the headline price.
Retail guru Steve Dresser notes a reduction in bag sizes of maltesers to 103 grams in his Grocery Insight. This he spotted at a Morrisions. He has a term for this: Shrinkflation.
If anything it’s worse than inflation because of the sneaky way suppliers have gone about imposing it.
Where’s Tesco-man now when we need him? Come on Mr Lewis, put on your cape, pull your undies up over your trousers and give the rotten so-and-sos what for!
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