Unilever Israel Cereal Sales Take a Plunge After Salmonella Scare

Concerns about contamination causes sales of Telma Cornflakes, Delipecan to drop up to 60%.

Telma cereal (illustrative)
Telma cereal (illustrative)Credit: MySupermarket

Concerns about the presence of salmonella bacteria caused sales of Telma Cornflakes and Delipecan – two of Unilever’s most popular breakfast cereals – to plummet over the weekend, with other cereals taking a hit as well.

Supermarket chains said sales of the two products were down 30%-50% after Unilever Israel, the company that makes the cereals confirmed on Thursday it had suspended production after discovering that one of its production lines had been contaminated.

It was the second such incident in a month and the company initially avoided saying the problem was salmonella. Other Unilever cereals suffered sales drops of about 15% on average, although a Unilever spokesman said all its products on the store shelves or that had already been purchased are safe to eat.

“On Thursday itself the drop in sales wasn’t that big, but on Friday the decline was 46% for Cornflakes sales even though we didn’t have any shortage of the product on our shelves,” said one supermarket executive, who asked not to be named. “Sales of Delipecan were down 65%, but that was because we didn’t have a lot of the product from Unilever – the real drop in Delipecan sales was more like 50%.”

The timing of the conparticularly unfortunate for Unilever Israel, the local unit of the giant British-Dutch food company, because Friday is the biggest day of the week for food shopping.

People with salmonella infection often have no symptoms but can develop diarrhea, fever and abdominal cramps within eight to 72 hours. Most healthy people recover within a few days without specific treatment. Yet life-threatening complications may develop if the infection spreads beyond the intestines.

Despite the drop in sales, food retailers said few shoppers returned cereals they had purchased before the warning, even though Unilever said on its Facebook page it would refund customers even though it did not believe there was any danger.

A similar incident occurred about a month ago, causing cereal shortages at supermarkets.

But even though it was the second time around for the company, the damage to Unilever Israel’s sales and reputation appears to have been minimized by the fact that many consumers don’t associate the company, Israel’s fifth-largest food maker, with its full range of products, just with Telma.

The company itself may have encouraged that: In media statements, it identified its CEO, Anat Gavriel, as CEO of Telma, not of Unilever Israel. The company also makes Strauss Ice Cream, Blue Band margarine, 778 jams and jellies, and Lipton Tea as well as personal carwe products.

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