Kraft Heinz Canada president Simon Laroche believes that the Grocery Code of Conduct in Canada will have a positive impact on stabilizing prices in the grocery industry. Despite the rising costs of groceries in recent years, Kraft Heinz has taken steps to absorb some of the input cost increases to prevent passing on higher prices to consumers. Laroche mentioned that the company has increased productivity and efficiency to manage costs effectively.
Supply chain disruptions have been a challenge for Kraft Heinz, but Laroche mentioned that the company has diversified its sources of ingredients to become more resilient. Additionally, Kraft Heinz has implemented a strategy known as price-pack architecture, offering different sizes of products at various price points to cater to different consumer segments. This strategy aims to attract new customers and convert them into loyal buyers.
Critics have compared price-pack architecture to shrinkflation, where manufacturers reduce the size or quantity of a product while maintaining the same price. Kraft Heinz has faced scrutiny over its packaging sizes, with reports of shrinkage in some products. However, Laroche emphasized that the company is focused on controlling prices while ensuring quality and taste in its products.
Laroche believes that the Grocery Code of Conduct, which aims to improve relationships between grocery stores and suppliers, will help stabilize prices in the long run. Having previously worked in Australia, where a similar code is in place, Laroche is optimistic about the potential benefits of the voluntary code in Canada. He emphasized the importance of creating a level playing field for all stakeholders in the industry to promote fairness and stability.
Overall, Kraft Heinz is committed to delivering quality products at competitive prices while navigating challenges in the market. By leveraging strategies like price-pack architecture and adapting to changing consumer demands, the company aims to maintain its position in the Canadian grocery market while contributing to price stability for consumers. Laroche’s insights into the impact of the Grocery Code of Conduct shed light on the industry’s efforts to address pricing concerns and ensure a fair trading environment for all parties involved.
