Latest News

Frito-Lay Chips Return to Loblaw Stores After Two-Month Pricing Dispute

Frito-Lay Chips Return to Loblaw Stores After Two-Month Pricing Dispute

By Simon Hung

April 11 update: Frito-Lay and Loblaw Companies have settled their pricing dispute after an eight-week impasse, which means Frito-Lay chips will be trickling back into Loblaw-owned grocery stores as early as the Easter long weekend. Both companies have declined to comment on how the dispute was resolved, only confirming a mutual resolution between the two was reached on Monday.

This is a welcome sign for both chip fans and Loblaw stores, as the chip aisle was often barren over the past two months and the grocer was forced to fill the empty space with inferior store-brand chips from No Name and PC.

____________________

Published February 18: Loblaws Stops Carrying Frito-Lay Chips Due to Pricing Dispute

The chips are down if you visit any Loblaw-banner store this week, as the grocery chain has stopped carrying Frito-Lay chips due to a pricing dispute between the two companies.

News of the retail squabble first surfaced last week, after Loblaw Companies refused to accept price increases on products supplied by Frito-Lay, which include an enormous catalogue of popular snack brands like Cheetos, Doritos, Lay's, Miss Vickie's, Ruffles and Tostitos. As a result, Frito-Lay has halted all orders to over 2400 Loblaw-owned grocery stores across Canada, including subsidiaries like Atlantic Superstore, Maxi, No Frills, Real Canadian Superstore, Shoppers Drug Mart, Zehrs and others.

According to Frito-Lay Canada, the company was forced to adjust product pricing due to rising manufacturing costs and ongoing supply chain issues stemming from the COVID-19 pandemic. After Loblaw Companies refused to accept the higher prices, Frito-Lay made the decision to stop supplying Loblaw stores.

In a statement to the Toronto Star, Loblaw spokesperson Catherine Thomas says the company is focused on minimizing prices for customers and noted "When suppliers request higher costs, we do a detailed review to ensure they are appropriate. This can lead to difficult conversations and, in extreme cases, suppliers don't ship us products."

Frito-Lay Canada has not commented directly on the dispute, but a spokesperson has confirmed that there is a "temporary disruption with one customer."

Loblaw-banner stores will not be re-stocking any Frito-Lay products until the dispute is settled, but Frito-Lay products are still available at competitors including Metro, Sobeys and Walmart for any Canadians who have a potato chip craving.

____________________

Source: Toronto Star, with reports from The Canadian Press

39 Comments

    • Win-win, less junk food for me and will save me some money.
    • Report Post
    • here's the thing - loblaws group of companies also makes their own chips and snack lines. They know what's reasonable and what's not reasonable. That they are willing to say no Pepisco says quite a bit too.
    • Report Post
    • here's the thing - loblaws group of companies also makes their own chips and snack lines. They know what's reasonable and what's not reasonable. That they are willing to say no Pepisco says quite a bit too.
      That being said, if I were Loblaws, I'd want a higher priced Frito Lay to help steer eyes over to the store brand PC & No name chips that would be sold at a much lower price. Oh well...
    • Report Post
    • This has been going on for a few weeks now, you may have noticed low or no stock at loblaws banner stores the past month or so because of this with the Presidents Choice brand filling up the empty space left behind. Managers have been directed to order more no name and presidents choice chips so consumers don't notice bare shelf space.

      We will see what happens from what I hear soda is next if these tensions continue.
    • Report Post
    • Loblaws had a $1 per bag sale of PC chips just a few single months ago. Either they were losing money or it was close to breakeven. I wonder what frito-lay was demanding for the price if loblaws was willing to sell at $1/bag.
    • Report Post
    • Loblaws had a $1 per bag sale of PC chips just a few single months ago. Either they were losing money or it was close to breakeven. I wonder what frito-lay was demanding for the price if loblaws was willing to sell at $1/bag.
      Their No Name brands have always been $1/bag....at least at No Frills so it's doubtful they're losing money or breaking even. Chips aren't expensive to make. Potatoes, oil and seasoning and a plastic bag to put them in. They also have a Long shelf life.
    • Report Post
    • Pepsico, a US multinational that is one of the largest producers of products that contribute to the diabetes, heart disease, obesity and overall ill health of our population is in a dispute with a Canadian grocery giant? ... Go Loblaws !
    • Report Post
    • here's the thing - loblaws group of companies also makes their own chips and snack lines. They know what's reasonable and what's not reasonable. That they are willing to say no Pepisco says quite a bit too.
      Well they don't actually make them, they are typically made by some US company like Herr's, etc. That said they still know what the increases should be like, as you say, as they are likely seeing them in those areas to a lesser degree or not at all.

      Frito-Lay is clearly scammin' like most companies have been doing. Just making up or grossly over exaggerating stores and fairy tales about "shortages" and "logistics" and all other manner of nonsense in order to raise prices and get richer. Rich will do anything and everything to get richer and they will capitalise on any chance they see they can pull a fast one and try to justify insane increases. And this right here is why inflation has unashamedly risen to the highest level in 40 years or so--'cause they all think they can get away with it.

      All the people too gullible to know it's a scam just suck it up and are just like "yeah shortages hurr durr, guess everything's going up!" and blindly accept it. Loblaw's ain't no angel themselves, we know that, but it is good that they are standing up to this BS for the rest of us. If only we could see this happen elsewhere too, and happen with people also refusing to buy stuff at inflated prices or buying a lot less of it at least.
    • Report Post

    • Frito-Lay is clearly scammin' like most companies have been doing. Just making up or grossly over exaggerating stores and fairy tales about "shortages" and "logistics" and all other manner of nonsense in order to raise prices and get richer. Rich will do anything and everything to get richer and they will capitalise on any chance they see they can pull a fast one and try to justify insane increases. And this right here is why inflation has unashamedly risen to the highest level in 40 years or so--'cause they all think they can get away with it.
      Dude, these are both major and widely-held publicly traded companies on the stock market - there is no one person controlling everything deciding "they" want to be richer - any material cost changes are required by law under securities regulations to be publicly disclosed. We will see these cost increases reported in their earning reports, they can't just make it up, nor lie about it in those reports.

      Most of both Loblaw and PepsiCo's shareholders are pension funds and other institutional investors, along with normal middle-class individual shareholders or indirectly via ETFs. that rely on their dividends for income (I own Loblaw shares myself, and PepsiCo via an ETF).
      Well they don't actually make them, they are typically made by some US company like Herr's, etc. That said they still know what the increases should be like, as you say, as they are likely seeing them in those areas to a lesser degree or not at all.
      This is the only part of your post that is actually true. For their own branded no-name and PC chips, their supplier who actually manufactures them will also give them an actual comparison to know if PepsiCo/FritoLay is full of it.
    • Report Post
    • Dude, these are both major and widely-held publicly traded companies on the stock market - there is no one person controlling everything deciding "they" want to be richer - any material cost changes are required by law under securities regulations to be publicly disclosed. We will see these cost increases reported in their earning reports, they can't just make it up, nor lie about it in those reports.
      "Dude" WTF are you on about? Publicly traded doesn't mean shit. Do you think the CEOs and other executives are making the same money as "the public"? Give over, if you don't get how wealth is divided up in the world, don't talk stupid meaningless nonsense. The rich keep getting richer, they're not doing it by being honest folks that do things caring about the "public" blue collar, etc. people out there. Sure it's a corporation, sure there are shareholders, that doesn't mean that the shares are held equally among people and it doesn't mean that the guy working in the chip factory busting his ass 9-5 everyday, makes the same money as the CEO...or anything even remotely close to it.
      This is the only part of your post that is actually true.
      Oh yeah I need you, Professor Joeflix I guess? To tell me what's true and what's not. :facepalm: Don't think so.
    • Report Post
    • what kinds of markup for these chips ? $0.35 per bag ? If Loblaw sells 5,000,000 bags annually in Canada, that's $1,750,000 in margin. That's a drop in the bucket for them. I am sure they can make that lost margin somewhere else. 😉
    • Report Post
    • This is the only part of your post that is actually true. For their own branded no-name and PC chips, their supplier who actually manufactures them will also give them an actual comparison to know if PepsiCo/FritoLay is full of it.
      The store brand doesn't spend crazy money on TV and radio ads to promote their products.
      Sure, there's No Name running ads, but it's not just for their chips. It's for ALL No Name products.
      Meanwhile, for the name brand, Doritos alone gets their own commercials...to name just ONE product, let alone several others.

      All that advertising is ONE area where a lot of money is spent, and it has to be paid for somehow.
      The price of the product is where the money comes from.
    • Report Post
    • what kinds of markup for these chips ? $0.35 per bag ? If Loblaw sells 5,000,000 bags annually in Canada, that's $1,750,000 in margin. That's a drop in the bucket for them. I am sure they can make that lost margin somewhere else. 😉
      IF No name is 99 cents a bag, notice that it's 2 for $5 or 2 for $6 for name brand, but often just $3.29-$3.49 per bag for the name brand (size pending)
      Dollarama has $2 bags of Doritos, but that was a few months ago, and the price may have gone up.
      As for making up for losses, Loblaws can easily check in with another chip company and see what they have to offer. (to fill shelf space)
    • Report Post
    • Loblaw doesn't care they can fill the void with their chips. All chips taste the same whether it's Lays, No Name or PC.
    • Report Post
    • Loblaw doesn't care they can fill the void with their chips. All chips taste the same whether it's Lays, No Name or PC.
      That's not true at all. Some brands are more salty than others, some use a different oil than others.
      Plus also, PC brand is more willing to create unique flavours that no other potato chip company is willing to try selling.
    • Report Post
    • That's not true at all. Some brands are more salty than others, some use a different oil than others.
      Plus also, PC brand is more willing to create unique flavours that no other potato chip company is willing to try selling.
      Yes small differences but nothing drastic. I am sure Loblaw and Frito-Lay will come to an agreement as it's mutually beneficial more so for Frito-Lay given the scale of Loblaw, they don't have to lose out on those sales.
    • Report Post
    • Yes small differences but nothing drastic. I am sure Loblaw and Frito-Lay will come to an agreement as it's mutually beneficial more so for Frito-Lay given the scale of Loblaw, they don't have to lose out on those sales.
      :rolleyes: :facepalm: Are you a troll or something? & Coke and Pepsi are the same thing? Is that what you are trying to say? Not small differences. As I already said, some brands are more salty than others, some use different oil, altering the taste and so on, but they are not all the same. The taste is different from brand to brand.
    • Report Post
    • If no resolution, loblaw can start selling more gourmet potatoe chips
    • Report Post
    • :rolleyes: :facepalm: Are you a troll or something? & Coke and Pepsi are the same thing? Is that what you are trying to say? Not small differences. As I already said, some brands are more salty than others, some use different oil, altering the taste and so on, but they are not all the same. The taste is different from brand to brand.
      If you put a Lays Original and No Name Original side by side you may notice a slight difference. It's a potato chip not a soft drink where the flavor profile is different. Obviously taste will be different but not drastically that is my point. Also depends on who is making the No Name or PC potato chips for Loblaw could be the big name companies.
    • Report Post
    • Win-win, less junk food for me and will save me some money.
      I think they’ll just stock more “uncle ray’s” chips instead. Lol….
      I notice them popping up more recently. Its a cheaper chip alternative. I only used to see them @ corner stores and indie dollar shops.
      But now i’m noticing them being sold in mainstream grocery stores.
    • Report Post
    • As of a week ago they had lots of Frito-Lay products in my local Superstore, so maybe out here in BC they still have inventory.
      ***update Feb 20*** yup, local Superstore has empty shelves where the Doritos Lays etc chips normally located. Price labels still there. And yes as someone else noticed, the Walmart GV potato chips were missing over at the Walmart store a couple of days ago.

      I noticed in the last 6 months or year they put Dorito/Lays products on sale more often than before. I doubt the dispute will last long, people like chips and these are popular brands.
    • Report Post
    • it's not like pepsi is pulling all their product lines out of the loblaws umbrella stores. A compromise will be quietly agreed to and you wont even hear about it
    • Report Post
    • unless it hits PEP's earnings, i think PEP doesn't really budge here... stock has been steady eddy dividend grower the past decade... credit Indra Nooyi in the past for the growth and diversifying into "healthier alternatives" for PEP ... between Loblaw's stock and Pepsi stock - no doubt, Pepsi is a better investment... As always, the consumer will decide eventually. Certainly, Pepsi products are still being purchased despite passed on costs...

      Now, since we're talking about Loblaw's cutting PEP's supply of products here in this thread - we will find out who wins the game of "chicken"... I, for one, am eager to see the result...
    • Report Post
    • I think they’ll just stock more “uncle ray’s” chips instead. Lol….
      I notice them popping up more recently. Its a cheaper chip alternative. I only used to see them @ corner stores and indie dollar shops.
      But now i’m noticing them being sold in mainstream grocery stores.
      And I thought I'm off the hook.
    • Report Post
    • Grocery shoppers are the real losers, no matter … in this case or any other groceries they buy going forward.
    • Report Post
    • I hope this will lead to Loblaws making a deal with Old Dutch to bring their entire line to their stores. When I was in Vancouver a few years ago I was amazed to see so many Old Dutch products on the shelf.
    • Report Post
    • Wonder what's up with this one. Limits on ice cream treats.
    • Report Post
    • If you put a Lays Original and No Name Original side by side you may notice a slight difference. It's a potato chip not a soft drink where the flavor profile is different. Obviously taste will be different but not drastically that is my point. Also depends on who is making the No Name or PC potato chips for Loblaw could be the big name companies.
      Unless something has recently changed, I can tell the difference between a No Name chip and a Lays chip blindfolded. The difference is more than slight. No name is saltier, to say the least.
    • Report Post
    • Some off brand names of products are actually much better than name brand, an example for me is Presidents Choice Diet Gingerale as I like it above any name brand beverage.

      For potato chips however I haven't found a suitable alternative.

      At the moment I pick up most of my protein and general groceries at Costco, will continue to go to No Frills or Valuemart for beverages and all additional groceries including fruits and vegetables. Chip wise I usually go with Mrs Vickies, Skinny Pop or Tostitos and do not think they are affected.

      Will be interesting to see who blinks first seeing people love their snacks, while Fritolay will lose share I suspect Lowblaws and their other chains will also lose customers and revenue.

      A perfect battle to see who is the dog and who is the tail.
    • Report Post
    • This is some what related, but I haven't been able to find Walmart Great Value Rippled/Wavy chips for almost 3 weeks now! Just empty shelves. Were those also produced by Frito-Lay?
    • Report Post
    • If you put a Lays Original and No Name Original side by side you may notice a slight difference. It's a potato chip not a soft drink where the flavor profile is different. Obviously taste will be different but not drastically that is my point. Also depends on who is making the No Name or PC potato chips for Loblaw could be the big name companies.
      I must be a connoisseur of junk food because i can easily distinguish between various pop brands, potato chips, corn chips, cheese puffs. The one area that's a bit more similar are corn based tortilla chips (unless you buy the uniquely shaped ones) but even there it can vary significantly. in BC there's a brand I tried which is close to restaurant style quality.

      Sigh...a junk foodie who can't get paid for his skills.
    • Report Post
    • I prefer the no name chips to Lays. I wouldn't miss it at all if Lays was completely replaced.
    • Report Post
    • I visited my local No Frills this morning and saw half empty shelves of Frito-Lays and PC's own brand chips.
    • Report Post
    • That's ironic given that all Loblaws stores under any banner have hiked prices more than any other grocery store in the past year, even at 'low-priced' No Frills. This seems like a publicity stunt to deflect from the company's unethical practices. Maybe they can fool consumers into thinking that Lays is the culprit here.
    • Report Post
    • That's ironic given that all Loblaws stores under any banner have hiked prices more than any other grocery store in the past year, even at 'low-priced' No Frills. This seems like a publicity stunt to deflect from the company's unethical practices. Maybe they can fool consumers into thinking that Lays is the culprit here.
      100% agree. No Frills has jacked up prices beyond inflation to line their profits.
    • Report Post
    • Some off brand names of products are actually much better than name brand,
      Can be, though I find the very few times I try PC brand chips I find them too salty. Or maybe because I avoid sodium and very, very seldomly eat salted chips so it just seems too salty to me.
      The one area that's a bit more similar are corn based tortilla chips (unless you buy the uniquely shaped ones) but even there it can vary significantly. in BC there's a brand I tried which is close to restaurant style quality.
      Probably Que Pasa. Part of Nature's Path.
    • Report Post
    • Agreed. No frills prices are no longer “cheap”
    • Report Post
    • Well they don't actually make them, they are typically made by some US company like Herr's, etc. That said they still know what the increases should be like, as you say, as they are likely seeing them in those areas to a lesser degree or not at all.

      Frito-Lay is clearly scammin' like most companies have been doing. Just making up or grossly over exaggerating stores and fairy tales about "shortages" and "logistics" and all other manner of nonsense in order to raise prices and get richer. Rich will do anything and everything to get richer and they will capitalise on any chance they see they can pull a fast one and try to justify insane increases. And this right here is why inflation has unashamedly risen to the highest level in 40 years or so--'cause they all think they can get away with it.

      All the people too gullible to know it's a scam just suck it up and are just like "yeah shortages hurr durr, guess everything's going up!" and blindly accept it. Loblaw's ain't no angel themselves, we know that, but it is good that they are standing up to this BS for the rest of us. If only we could see this happen elsewhere too, and happen with people also refusing to buy stuff at inflated prices or buying a lot less of it at least.
      I don't know how you equate this article to scamming. And you are kind of misguided if you think they are doing this to stick up for the rest of us.

      I think what you are clearly missing and what is referenced in the article is that for Frito-Lay to cut away their biggest purchaser is a huge move. Loblaws owns 1/3 of the grocery business. If it was simply a matter of Frito-Lay overcharging them they would simply cut back and offer them bigger discount/price reduction after a whole lot of grumbling and a big show. No company wants to lose one of if not their biggest purchaser of their product. The fact that they are not wiling to do that speaks volumes for the price pressure Frito-Lay is experiencing. There's a million other potato chips on the market.

      What Loblaws is doing is not different than Walmart refusing to take Visa for a while due to cost increases. It's a negotiating tactic. Eventually both will come to a deal.

      But your clearly in the everyone is scamming camp and as you say logistic and supply chain issues are fairy tales, I guess that's why I drive by new car lots that have been empty for the past 12+ months, people been waiting months for new appliances and furniture deliveries, plus the hundred other examples I could give off the top of my head. Clearly, most stores out there big small, corporate or small mom and pop shops have banded together world wide to fabricate and perpetuate this supply chain myth.

      It's a conspiracy of epic proportions
    • Report Post
    • Lawblaws is protecting their margins, there is just so much you can raise prices and with that the lower the price from the manufacturer the delta (profit) is highest.

      Lablaws is squeezing the manufacturer, and squeezing the customer.....making the largest profit they can.
    • Report Post