Tesco boss: Multinationals should not use weaker Sterling to hike prices
The boss of Tesco says suppliers should not use the weak pound as an excuse to raise prices.
Tesco's chief executive Dave Lewis say that global companies should not put profits first.
He was speaking the wake of 'Marmitegate', when Unilever tried to enforce price hikes of 10% last month on products including Lyons tea, Hellmans mayonnaise and Marmite.
Sterling has fallen around 16% against the dollar since the UK voted on June 23 to leave the EU, making imports more expensive. It is also down to a lesser extent against the euro.
Tesco scored a public relations coup in October when it briefly halted online sales of goods produced by Unilever after the Anglo-Dutch group sought to lift prices of popular brands such as Marmite. The two quickly reached an agreement, the terms of which have not been disclosed.
Mr Lewis said that when there is a currency devaluation, multinational businesses present results in both constant and current exchange rates.
“And the City (financial investors) completely understands it, they don’t devalue a stock because of that, they understand it’s part of the volatility of being in many countries,” Mr Lewis said.
“The only thing we would ask of companies that are in that position is they don’t ask UK customers to pay inflated prices in order that their reporting currency is maintained. They don’t do that for countries outside of the UK,” he said.
