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"Shoppers hit by escalating prices of branded goods"
Makers of some popular food brands have raised prices by more than their costs over the past two years, according to the UK's competition watchdog.
This has helped push up the price of things like baby formula, baked beans, pet food and milk, the Competition & Markets Authority (CMA) said.
About three quarters of branded suppliers have been making more profit on individual products.
I'm a bit confused by this. Isn't this how the free market is supposed to work? If Heinz gear is too pricey, we buy alternatives.
Confirmed by by this line...
As a result shoppers have increasingly turned to own-label products, meaning branded products have lost market share, and so have actually been making less money overall.
The full news item is here...
https://www.bbc.co.uk/news/business-67563844
Comments
I'm not at all sure I understand the problem.
If stuff is too dear at Tesco, we go elsewhere.
If there's a monopoly in the supply of, say baby food & the manufacturers are lifting our leg, another supplier will seize the opportunity to muscle in on the market.
Apart from Communist countries, surely that's how it works right across the world?
I am aware that, say, the likes of Microsoft & others have been accused of similar things, but if you have a superior product, that's bound to happen until someone says "well I'll supply something better".
Tool Station if you want A SCREW
An oligopoly is where the market is dominated by a select few players.
A typical example is washing powder and allied products. There are only 2 real players-Proctor & Gamble, and Unilever.
Both have loads of brands, with marketing budgets for each. P&G includes the likes of Ariel, Bold, Daz, Fairy & Lenor. Unilever has Comfort, Persil and Surf. Main reason for the multitude if brands is to discourage competition. Because they (in my example) provide 8 rivals, rather than 2.
When a Supermarket says it is "price matching" with a rival, what it is really saying is it is price fixing.
Oligopolies do not have the economies of scale of a monopoly. They also spend vast amounts of money doing the same work several times-prices do not tend to vary for people supplying supermarkets. Just 6 sets of paperwork. The "yes" or "no" is more likely to vary than the price
Tend to get the worst of both worlds-price fixing at a higher price than either a free market or a monopoly would provide.
When I say literally I mean exactly that the very same food product goes into a branded box or product as goes into a non branded box/product its literally the same.
I cant comment on exact brands for this as that is kind of breaking trust when you work in the warehouses and you sign contracts about that stuff. However it goes on a lot. I cant this applies to every food product and there isnt a way of knowing really unless you have inside info.
However it does highlight what is the point in buying branded product?
none of these apply to what I saw so maybe for names I am about to mention you might need to buy the name to get the same product but it may be the same again.
I usually buy titan bars not mars bards
I buy Racer bars not Snickers
I dont buy Heinze tomato ketchup or mayonnaise I buy the non branded stuff.
If you buy the branded stuff you are literally just paying to have a name on your chocolate wrapper cereal box ketch up bottle or etc. I mean why waste your money paying for a name?
If your struggling it makes no sense
if your not struggling the money you save may even pay for an extra holiday or new car over the period of a year.
if your minted I guess it makes no difference as the money means little to you but then why care about the brand name anyway? because its just a name.
If I hit a point where money means nothing I am just as likely to buy a Titan bar as I am a mars bar its simply whichever one is nearer is an Aldi nearer or is it a petrol station?
it makes little sense to go for branded products.
You can thank johny vegas for sharing that wonderfully useless information!