Surely ‘the great Easter egg shortage’ was the classic case of reap what you sow both for manufacturers and multiple grocers, and arguably to a lesser extent for consumers too.
There was a time when the place to buy Easter eggs was the local specialist sweet shop, and people accepted that for the purchase of a gift, price was not the most important factor.
This category was one of the early targets for the multiples as an area to make their own and to drive footfall, and price was the tool to achieve this.
Suppliers were complicit in this targeting, seeing large orders and displays as enhancing their brands rather than devaluing them as was actually the case.
The race to the bottom created many costs, including huge volumes of eggs discounted through specialist jobbers, as forecasts failed to materialise. Traditionally, these sales took place after Easter, but in recent years, they have increasingly been happening before Good Friday as panic set in.
“There is irony in listening to mults’ bemoan a lack of profitability”
Independents tried for years to retain some sales in this increasingly dysfunctional market but ultimately most concluded that they could not do so. The pricing adopted by supermarkets became ever more aggressive, moving from initially selling at prices close to independents’ cost to multibuys, bogofs and even buy one get two free.
The equivalent pricing of these deals was massively below the cost price to the wholesale sector, however big an order was placed.
Indeed, this specialist area became one of the most visible examples of abuse of buyer power by the multiples for short-term gain, and the inevitable consequence was the exit from selling Easter eggs by independents.
The fiasco of this year’s market should surely act as a warning to all suppliers of being hypnotised by the promises of riches for supporting ever deeper promotional activity in any category, and (with apologies for the pun) of putting all your eggs in one basket.
For the independent sector, there is also a delicious irony in listening to the multiples bemoaning a lack of profitability in the category - a problem entirely of their own creation - while frantically gearing up the PR department to deny that any problem actually occurred.
Do I have any solutions? A starting point might be accepting that Easter is genuinely an opportunity for sales of a product because it meets consumer needs rather than because it is cheapest on display. A level playing field on price, and added value activity for independents (indeed any genuine sustained attempt to reintroduce consumers to buying gift confectionery locally) would be welcome.
Steve Parfett is chairman of AG Parfett & Sons
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