Red Armies: Super-Sol Sparking Meat-price War

Israel's biggest food retailer launching private label brand with lower prices, prompting rivals to retaliate

Adi Dovrat-Meseritz
Adi Dovrat-Meseritz
Schechitah UK fears kosher slaughter will be put to a vote in Parliament.
Schechitah UK fears kosher slaughter will be put to a vote in Parliament.Credit: Bloomberg
Adi Dovrat-Meseritz
Adi Dovrat-Meseritz

The meat wars are on.

They were formally declared by Super-Sol, Israel’s largest supermarket chain, on Tuesday, when it launched a private label brand of fresh Angus beef for an average 16% less than the best-selling Adom Adom brand of Tnuva.

Industry sources, who only a few days ago were warning about rising meat prices, say Super-Sol’s move would likely bring down prices by a fifth. The discount supermarket chain Rami Levy was ready to meet the price of meat at Super-Sol – or even better it – as of Monday.

“I promise that these will remain our prices until after the High Holidays [in September and October.] We will always be the cheapest,” said the chain’s founder and CEO Rami Levy.

At Super-Sol Deal, private label entrecote will sell for 139.90 shekels ($36.57) a kilogram starting on Wednesday, compared with 159.90 shekels for the equivalent Adom Adom cut. The price of the private label beef would put it head to head with the Victory chain’s price for Adom Adom and higher than Rami Levy’s Dabbah brand at 99.90 shekels.

But Super-Sol CEO Itzik Abercohen said a 16% difference in the price between its private label and Adom Adom should do the trick. “In certain segments, like milk and meat products, even a 5% discount is significant because they are the kind of products that families consume on a regular basis,” he explained.

Super-Sol executives said they expected meat sales to jump 50% in quantity terms after the launch of the private label brand.

The meat wars mark the latest development in a food retail sector coping with falling prices and a bitter fight over market share, as shoppers focus on price over brand name and convenience. The discount trend has battered Super-Sol’s profits and forced its No. 2 rival to close, sell stores and reschedule debt.

Eyal Ravid, one of the controlling shareholders of the Victory chain, said he wasn’t impressed with Super-Sol’s price-cutting, saying the discounts were less than they seemed because Adom Adom products typically sell for less than Super-Sol’s advertised price.

Still he sees prices coming down for retailers and shoppers, and maybe even a price war.

“I think slaughterhouses would lower their prices by 15% to retailers and retailers will lower prices to the consumer by about 20%. Then we’ll see if Super-Sol will offer specials on private label products. We’ll reduce prices by 15% next week,” said Ravid.

Super-Sol executives said they expected their private label products, like most other Israeli beef imported from Argentina, would capture 40-50% of its 1 billion shekels of annual sales of fresh meat. Right now, Adom Adom has a 58% share of the retailer’s fresh meat sales, Dabbah another 32% and other labels the remainder.

Already, Rami Levy is vowing to launch his own private label product, which he said will bring prices even lower. Abercohen declined to say whether he would meet the competition on price. “I wish him luck. Everyone prices their products how they want. We’ve already brought our good news to the people of Israel. Beyond that, I don’t want to comment,” he said.

Super-Sol is already a leader in the private label segment, which smaller chains have been hesitant to push too hard for fear of alienating the big food makers and importers. Today, private label accounts for 15% of its turnover, up from 9% a year ago.

Super-Sol uses private label both as a negotiating tool opposite suppliers to squeeze discount from them and because it is more profitable.

At a news conference on Monday, Super-Sol executives said private label products accounted for 30% of sales in the categories where they are represented and causes competitors to cut their prices. For instance, disposable diapers now sell for an average of 42.60 shekels, compared with 47.20 before the chain introduced a private label brand.

Most recently, the private label dairy products launched by Super-Sol three months ago have captured a third of milk carton sales, they said.

Click the alert icon to follow topics:



Automatic approval of subscriber comments.

$1 for the first month

Already signed up? LOG IN

Protesters demonstrating in front of the consulate general of Israel in New York last year.

Huge Gap Between Young, Old Americans' View on Israel-Palestine

Rep. Henry Cuellar attends a campaign event on Wednesday, in San Antonio, Texas.

AIPAC-backed Dem Declares Victory Against Progressive Challenger in Texas Runoff

Iranian President Ebrahim Raisi and Atomic Energy Organization of Iran chief Mohammad Eslami at an event for Nuclear Technology Day in Tehran, last month.

Prospects for Reviving Iran Nuclear Deal 'Tenuous' at Best, U.S. Envoy Says

A family grieves outside the SSGT Willie de Leon Civic Center following the mass shooting at Robb Elementary School in Uvalde, Texas on Wednesday.

Israeli PM Offers Condolences After Texas Gunman Kills 21 at Elementary School

U.S. President Joe Biden, this week.

Biden Decides to Keep Iran's Revolutionary Guards on Terror List, Says Report

ADL CEO Jonathan Greenblatt.

Progressive Jews Urge ADL Chief to Apologize for Calling Out Democratic Activist