Wegmans Won’t Raise Prices on Popular Products
Despite skyrocketing commodity and fuel costs, Wegmans Food Markets has vowed not to increase prices through 2011 on 40 products most purchased by families, as a way to help people stay within their budgets.
“We considered the importance of an item to a family when choosing our list of 40,” explained Colleen Wegman, president of the Rochester, N.Y.-based supermarket chains. “Such things as bananas, pasta, frozen vegetables, and laundry detergent are in most shopping carts every week. They are products that families can’t do without, so what they pay for these items really matters.”
Also included in the price freeze are orange juice, canned coffee, cereal, red peppers, tomato sauce, chicken, ground beef, salmon, tilapia, tuna, frozen pizza, and deli ham and turkey. Because some of these items come in several sizes and varieties, the actual number of items covered by the pledge is about 200 SKUs.
Nearly all of the products are sold under the Wegmans brand. “We can be more aggressive with pricing for our own brand because we have better access to information on the factors that determine costs,” noted Jo Natale, the grocer’s director of media relations. “These products are already the best value in their respective category, and for that reason, they are also usually the top-selling brand in a category.”
According to Natale: “Costs for many of these products have risen and may continue to rise over the next nine months. If retail prices reflected the true cost of goods, it would mean an additional $350 to $400 annually for a family of four.”
Commodity prices have risen because growing demand, but shrinking supply, with much higher costs for soy-, corn- and wheat-based ingredients in food products, as well as feed for livestock, pushing up production costs. Fuel costs to transport products are also rising, placing additional upward pressure on prices.
On Sunday, Feb. 27, Wegmans will run a print ad informing customers of the price freeze.
“News that food prices will rise is worrisome for our employees and our customers,” said CEO Danny Wegman, “especially when folks are also dealing with higher gas prices. We hope that it will help knowing that prices will stay the same for the essentials, and that our commitment to consistent low prices overall is still in place.”
Wegmans operates 77 stores in New York, Pennsylvania, New Jersey, Virginia, and Maryland, and plans to open its first New England store later this year in Northborough, Mass.