supermarket - Ofer Vaknin - June 17 2011
Israelis are paying far too much for milk products in supermarkets. Photo by Ofer Vaknin
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In the wake of the success of the consumer boycott of Tnuva dairy products, the leaders of the movement are expanding their targets. Ori Reshtik, the head of the Tel Aviv University student union, sent a note Tuesday to food manufacturers Osem, Telma and Strauss demanding that they reduce prices of their products.

Itzik Alrov, the man whose cottage cheese boycott campaign started the consumerism ball rolling a few months ago, sent similar missives to these companies. He joined other social activists in a visit to Strauss headquarters on Tuesday for a meeting with Strauss Israel CEO Zion Balas, to whom he gave his letter.

"We said that now we're demanding the companies cut their prices significantly by the Sukkot holiday, and if they don't the battle that began with Tnuva will expand to Osem, Strauss and Telma, each one separately, in cooperation with the student union," Alrov said, referring to the holiday which begins next Wednesday.

He said the goal was to achieve a 30 percent price reduction.

In his own letter to the food processors, Reshtik wrote that he and his activist colleagues, like many Israelis, feel that the lack of price controls and the state's failure to take action has forced people to reduce their consumption and to choose between buying inferior goods or paying more for items that had previously been more affordable.

"We realized that we must take control of our lives and our futures as citizens of the state and to launch a consumer struggle against the retail chains and the big companies, which contribute to the high price of goods, but without causing damage to workers and their families," Reshtik wrote.

His letter did not explicitly threaten a boycott, but did allude to an informal action.

"Israeli consumers are aware of their power, and they will choose to buy from the companies that cut their prices without sacrificing product quality and without hurting the pay of their employees," he wrote. "The boycott is a means, not an end in itself. It is the only democratic tool available to us as consumers, as long as the state does not do its part in solving the problem of the high cost of living."

Speaking to Haaretz, Reshtik said he and his fellow boycott leaders were studying Osem, Strauss and Telma in depth in order to determine their potential for price cuts.

"If the three of them don't reduce prices, there's a good chance that we'll lead a consumer boycott against one, two or all three of them. We are examining all of the options," Reshtik said.

Nadav Stark, research coordinator of the TAU student union, said the decision to make Osem, Telma and Strauss the next targets of the consumer protest was an obvious one.

"They are the big three food manufacturers, they're among the five big companies who supply 40 percent of the food we buy. Each one of them has a monopoly in one market sector or another," Stark said.

He explained that the student union's efforts to determine the scope of potential price reduction included comparing prices in other countries and measuring price increases against the consumer price index.

"In May and in April, Osem and Unilever [which owns Telma] raised prices by a few percent, and you ask yourself why. The entire industry wondered why. But in May and in April, unlike today, nobody was listening," Stark said.

The student researchers also examined price differences among different-sized packages of the same product. "When you buy a half-kilo of hummus and see that a kilo costs just two shekels more, it's obvious that the difference in price doesn't reflect the true cost difference, which means it's possible to sell a half-kilo for a much lower price," Stark explained.

He took pains to emphasize that the boycott leaders did not want the companies' employees to pay the price of any price cuts.

"Our call is unequivocal: We want the companies to announce immediately that they are cutting the regular prices, not short-term sales, and that it will not come at the expense of their employees in any manner, and also not through pressure on subcontractors or on manufacturers," Stark said. "For us, hurting workers is the same as raising prices, and it will result in harsh criticism and measures on our part." He added that cuts should come from shareholder earnings, marketing budgets and other sources.

"I don't think a limited liability company shouldn't earn profits, but there's a difference between high profits and exaggeratedly high profits," Stark said.