Israeli Grocery Chains Delay Price Hikes

Planned November 1 increases will come gradually, supermarkets say.

Today, November 1, is the day many food manufacturers said they would be raising the prices they charge the supermarkets.

But the retail chains say they will not be passing on the increases to consumers so fast. The increases will come, but only starting next week when retailers have sold off inventory they bought from suppliers at the older, lower prices.

Rami Levy, of the supermarket chain that bears his name, said he would be raising prices in about two to six weeks. Although his chain had not consented to the revised the food makers' revised price lists, consumers will definitely be paying more, he said.

"If everyone [the other retailers] approves it, I'll approve it, other than a few items for which the hike is not justified. We won't see prices going up today," Levy explained, "because we have stock that we bought at the previous price and because we received a grace period from some of the manufacturers during which we can buy merchandise at the old price."

Dairy products, however, will be going up in price within the next several days, Levy said. They have a shorter shelf life and cannot be held in inventory.

An official from another chain explained that the price hikes will not be dramatic and in any event will wait until next week because Thursday and Friday are busy days at the stores. "We haven't accepted all of the suppliers' increases and we have asked for a deferral [of the increases] from others," he added.

Small groceries, which don't have bargaining power, are expected to institute price hikes today or early next week.

Super-Sol, the No. 1 food retailer, said yesterday it would raise prices gradually over the coming month, starting with dairy products in the next few days.

Mega, the country's second largest chain, also said it would not be raising prices today citing inventory bought at the old price. It is still in negotiations with suppliers over how much it will pay in the future.

An executive at one supermarket chain said his stores will take their lead from Super-Sol, the country's largest chain. "If Super-Sol raises its prices, I will too, and at the same rate," he said. "Everything begins and ends with Super-Sol. They are the biggest player in the market. I ...can't tell a supplier that I am approving or not approving a price hike, so I tell him I will wait to see what Super-Sol does." Another industry executive, though, said he will try to strike his own agreements with suppliers.

Shoppers at the Super-Sol branch at Tel Aviv’s Azrieli Center.Credit: Ofer Vaknin

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