Greedflation: Giants behind brands from Heinz soup to Head & Shoulders hike prices by up to 73% – while they reap £50bn profits
The consumer giants behind some of Britain’s favorite brands – from Heinz baked beans to Head & Shoulders shampoo – have been accused of greed and profiteering after hitting shoppers with huge price hikes while raking in bumper profits.
Hard-pressed families have been hit by inflation-busting rises on products such as Heinz tomato soup – which rocketed 73 per cent from 98p a can to £1.70 in a year – while the multi-national firms behind them are making billions.
Critics say the companies should use their vast profits to absorb some of the increased production costs, rather than passing them on to customers, and have called on market watchdogs to intervene.
The Mail on Sunday can reveal that seven of the biggest consumer businesses are about to unveil combined profits of £50 billion for 2022 – £2 billion more than the previous year.
The Mail on Sunday can reveal that seven of the biggest consumer businesses are about to unveil combined profits of £50 billion for 2022 – £2 billion more than the previous year
Yet they have imposed big price rises at the checkout, such as Unilever hiking the price of Hellmann’s mayonnaise by 42 percent from £1.75 to £2.49; Procter & Gamble’s Head & Shoulders shampoo rising 21 per cent from £2.33 to £2.83 and Heinz baked beans soaring 35 per cent from £1 to £1.35.
Such rises open firms up to accusations of ‘greedflation’ – using the cost-of-living crisis as a cover for hiking prices more than necessary.
Consumer champion Baroness Ros Altmann said: ‘To any normal consumer, this looks like greed and it needs an explanation. It feels like they are charging however much they can get away with.
‘There should be a CMA [Competition and Markets Authority] investigation into what is going on. If we want to control inflation, there is going to have to be an investigation into prices.’
Yet they have imposed big price rises at the checkout with rocketing costs for consumers
Sir Chris Bryant, the veteran Labor MP, said: ‘Under cover of the cost-of-living crisis, these companies seem to be engaged in shameless profiteering. It’s time they eased off the greedy pedal and gave consumers a better deal.’
Tory MP Mark Garnier said: ‘It is OK for businesses to make returns for their shareholders, that is capitalism. But modern shareholders look for businesses that have a commitment to the community and their environment.
‘These businesses need to demonstrate how they are helping those who are suffering, and our wider society. If they don’t, both their shareholders and their customers will abandon them.’
Of the firms making the total £50 billion global profits, Mondelez (the US conglomerate which owns Cadbury chocolate and Philadelphia cheese), Danone, Nestle, Procter & Gamble and Reckitt Benckiser (which owns Dettol, Harpic, Finish and more) are expected to say last year’s profit was significantly greater than in 2021.
Meanwhile, Unilever and Kraft Heinz, are predicted to say their figures are broadly similar to the previous year.
Unilever said it is trying to ‘absorb as much’ of the impact as it could, and Danone said it was making savings where possible. Mondelez said it is ‘impossible’ to shield consumers from the impact, but P&G and Reckitt did not comment
Last week, P&G increased its annual sales forecasts after pushing through multiple price rises last year – and finance chief Andre Schulten said there were more to come. In October, Nestle reported its strongest sales growth in 14 years with average price increases of 7.5 percent.
Reena Sewraz, retail editor of consumer magazine Which?, said: ‘We’ve seen huge price increases on lots of well-loved branded products in the last year or so, with our own findings showing hikes of well over 100 per cent in some supermarkets.’
Other rises reported by market research firm Assosia include P&G’s Ariel washing liquid going up 25 per cent from £5.83 to £7.27, Heinz tomato ketchup rising 39 per cent from £2.30 to £3.20 and Nestle Cheerios rising 20 per cent from £2.45 to £ 2.93.
In many cases, supermarket own-brand products are considerably cheaper than the branded equivalent.
Spokesmen for both Nestle and Kraft Heinz separately said last night that price hikes were a ‘last resort’. Nestle said it was absorbing billions of dollars in costs while Kraft pointed out that energy bills have risen 609 percent since 2019.
Unilever said it is trying to ‘absorb as much’ of the impact as it could, and Danone said it was making savings where possible. Mondelez said it is ‘impossible’ to shield consumers from the impact, but P&G and Reckitt did not comment.
‘It is time consumers got a better deal’