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Nestlé, Retailers Nearing Compromise In Price Row

Published on Apr 17 2018 11:39 AM in A-Brands tagged: Trending Posts / Nestlé / Edeka

Nestlé, Retailers Nearing Compromise In Price Row

Swiss food group Nestlé and retailers including German grocer Edeka are approaching a compromise in their months-long price fight but the outcome of talks remains open, a source close to the negotiations said on Tuesday.

Edeka, Germany's largest supermarket group, had written to its stores this month recommending they expand a boycott of some Nestlé products, an escalation of a pricing row between the world's biggest packaged food maker and European retailers.

Not Yet Reached A Breakthrough

Nestle and Edeka-led AgeCore -- the Geneva-based group of six European retailers that also includes Switzerland's Coop -- have not yet reached a breakthrough and the discussions could still fail, the source said on condition of anonymity.

"It's not yet home and dry," the source told Reuters. "Nothing is agreed until everything is agreed. The talks are ongoing."

Earlier, the Frankfurter Allgemeine Zeitung reported that a tentative compromise had been reached and that officials from both sides were hammering out the details of a new contract, citing an anonymous source that the German newspaper said was involved in negotiations.

"Nestlé managers were willing to make concessions on key points," the source told the paper.

The newspaper reported that the supermarket group was demanding, among other things, that Kit Kat maker Nestlé contribute more to cooperative marketing campaigns.

Sign Of Tension

Nestlé and Edeka declined to comment on any potential deal to end the dispute, which has emerged as the latest outward sign of tension between European retailers and suppliers at a time of changing consumer tastes and new online competition.

Nestlé, under the leadership of new chief executive Mark Schneider, is reeling from its weakest annual sales growth in at least two decades that has prompted shareholder pressure to boost revenue and profit margins.

It releases first-quarter sales on Thursday.

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine. 

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