By and  on February 7, 2008

PARIS — French supermarket chain E. Leclerc has withdrawn from its shelves six products — including two beauty creams — whose prices it claims were raised "excessively."

As reported in mid-January, the retailer publicly threatened (through ads in the French press) to pull the items, including L'Oréal Paris Men Expert Hydra Energetic Moisturising eye cream and Beiersdorf's Nivea DNAge Cellular Renewal day cream, whose prices E. Leclerc claimed had risen 18.5 percent and 18.4 percent, respectively, between August 2007 and January.

E. Leclerc maintains such hikes result from artificial inflation, rather than rising raw materials costs.

"The manufacturers of these items had proposed tariff increases from 50 to 100 percent above the average tariff increases in comparable categories," the retailer said on Friday.

A L'Oréal spokeswoman declined Friday to comment on E. Leclerc's move. However, during a conference call with financial analysts in January, L'Oréal's chief executive officer, Jean-Paul Agon, downplayed E. Leclerc's then threatened move as a publicity stunt.

"Leclerc has chosen to put forward the only product [of ours] whose price level had increased quite a bit," he said. "We would be relieved from a logistics point of view [if he pulls the item], since we don't sell it very much anyway."

Agon noted the L'Oréal Paris product sells in the hundreds or thousands of units and therefore does not even represent one-thousandth of its French subsidiary's sales.

"If they want to take it off the shelves, let them," he continued, adding that it would not change L'Oréal's relationship with E. Leclerc, which he called "a good partner."

Executives at Beiersdorf France, which in January rejected E. Leclerc's accusation, calling the campaign misleading, could not be reached for comment Friday.

Meanwhile, E. Leclerc said its move is not a one-off, and that 100 items are being considered and are the object of detailed negotiations with their manufacturers.

"If the manufacturers concerned revert to reasonable tariff proposals, their products will be returned to E. Leclerc's shelves," the retailer concluded.
— Ellen Groves


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