Love or hate it – the Marmite effect of Brexit
14 October 2016 by Ashton Carter
There was a sticky situation this week at Tesco as, up until last night, if you were planning on picking up some Marmite the next time you ordered your food from Tesco, you were going to be out luck.
Tesco initially dropped Marmite, Ben & Jerry’s, PG Tips and many other products from its online store over a price dispute with supplier of the goods, Unilever. Thankfully for fans of tea, premium ice cream and questionable spreads, the dispute was resolved and shelves can now be re-stocked.
So what led to such a drastic course of action to begin with? The situation arose when Unilever raised its prices by 10% in response to the sharp drop in the value of the pound, which led to Tesco not making any further orders. However, Unilever’s position was that increasing prices to offset rising costs is standard practice and a normal part of doing business.
Sadly, this is probably not the last that you will hear of this type of issue. The falling strength of the pound is too large of a cost for companies to carry without trying to pass it on to their end consumer.
Therefore, this is likely to trigger other manufacturers across many different markets to similarly increase their prices. So whether you love or hate our impending European exit, make sure you watch this space for any more knock on effects.
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