One of Canada’s biggest food manufacturers has halted shipments to the country’s largest grocer in an extreme example of how inflation is impacting the food industry.
At issue is a dispute over pricing between Frito−Lay Canada and Loblaw Companies Ltd. as the maker of brands like Cheetos, Doritos, Lays, Ruffles, and Sunchips tries to recoup higher costs.
The situation has left the chip and snack food aisle of many Loblaw stores stocked with the retailer’s house brands or less full than usual.
Frito−Lay spokeswoman Sheri Morgan confirmed there is a “temporary disruption” with one customer.
She says the company, which has faced unprecedented pressures from rising prices for things including ingredients, packaging, and transportation, has made adjustments to its prices to offset these costs.
Loblaw spokeswoman Catherine Thomas says the grocer is “laser-focused” on minimizing retail price increases and when suppliers request higher prices, Loblaw does a detailed review “to ensure they are appropriate.”
“This can lead to difficult conversations and, in extreme cases, suppliers don’t ship us products,” she said in an email, adding that the grocer doesn’t comment on specific negotiations.
feature image via The Canadian Press