French retailers agree to margin restraint during crisis periods

Planet Retail 20 May 2010

The major food retailers in France, including Carrefour, Auchan and Leclerc have agreed to exercise margin restraint during periods of crisis in fruit and vegetable production, following talks with President Nicolas Sarkozy, Just-Food reported. The agreement stipulates that that in time of "proven market crisis", when the price paid to producers is significantly inferior to the average of previous years, retailers will not increase their gross margin on the product in question.

Commenting on the agreement, the head of Leclerc, Michel-Edouard Leclerc, said: "My initial reaction to the way this was set up was one of irritation but I now believe this a good measure, given additional credibility by its restraining and collective aspects."

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See also "FRANCE: Paris intervenes on retailer margins" at http://www.just-food.com/news/paris-intervenes-on-retailer-margins_id111048.aspx

See also "Breton farmers disagree with limiting profit margins" at http://www.freshplaza.com/news_detail.asp?id=64988