Negotiations between Coles and Campbells Arnott’s have allegedly hit a roadblock over increases to the wholesale cost of Arnott’s biscuits and Campbell’s stock.
In October, Campbells Arnott’s reportedly told the supermarket giant it planned to increase the wholesale cost of several key lines, including Tim Tams, by 10 per cent – a request Coles originally refused to comply with.
Coles National Media Manager, Blair Speedy, told the ABC the retailer refused to accept the price increases because Arnott’s would not provide a justification for the price hikes. “We don’t just want to accept those prices and have to pass on the costs to our customers. So when we asked them to justify those price hikes they refused and then they refused to supply unless we paid up,” Speedy said.
This initial spat lead to shortage of key lines on Coles’ shelves, before the retailer acquiesced the price increases across the majority of Campbells Arnott’s biscuit and stock lines. However, Coles will no longer stock some of the less popular lines after refusing to accept the price increases on them. As such, Campbells Arnott’s no longer supplies Coles with items including Tim Tam’s specialty Adriano Zumbo range and Chocolicious range; Twisted Faves Monte Carlo: Salted Caramel; Twisted Faves Shortbread: Strawberry Cream; Arnott’s Chocolate Biscuits: Royal Dark; Arnott’s Cheeseboard; and Campbell’s Real Stock 500ml in chicken, beef, and vegetables flavours. The cost of remaining lines has increased by 15 cents to $3.65 nationally, bringing it in-line with Woolworths.
A Coles spokesperson told C&I Week there are around 30 different Arnott’s products stocked in Coles Express outlets nationwide.
“Coles has made a commitment to bring down the cost of shopping for our customers, and we have been doing that every year for the past six years. So when a major international manufacturer decides they will unilaterally force through a price hike without justification, we will resist that,” the spokesperson said.
Tim Tam shortage all hype?
The threat of a Tim Tam shortage has caused pandemonium across Australian media and social media platforms this week, with many fraught over the possibility of a Tim Tam-less existence.
While Arnott’s has remained tight-lipped, the company issued a media statement saying, “there is no shortage of supply of our famous biscuits, including Tim Tam. Like any business, we do review our prices and increased our wholesale prices in October. Our customers set the price at which they resell our biscuits to consumers, although we do collaborate with our customers to regularly fund promotions in-store”.
Woolworths has also declined to comment on the negotiations to media, but said that supply of its 12 Tim Tam lines remained plentiful. The Australian Competition and Consumer Commission (ACCC) told C&I Week it is unconcerned with the negotiations.
“Businesses will always engage in robust negotiations that do not attract the attention of the ACCC,” an ACCC spokesperson told C&I Week.