Shufersal Expands Private Label Coffee to Compete with Major Brands
Translated & summarized from Calcalist by baba
Shufersal is expanding its private label coffee offerings to compete with major brands like Strauss and Osem, aiming to offer lower prices. The move comes amid significant price hikes by Strauss in recent years, despite global price drops. Shufersal's extensive retail network will expose consumers to price differences, potentially driving them towards the private label options.
The story in 5 lines · by baba
- Shufersal is expanding its private label coffee products to compete with Strauss and Osem.
- The company is offering significantly lower prices on its private label coffee compared to leading brands.
- This strategy is partly a response to recent double-digit price increases by Strauss.
- Shufersal's private label coffee includes Turkish, instant, ground, and Nespresso-compatible capsules.
- The retailer aims to encourage competition and provide better value to Israeli consumers.
Shufersal, Israel's leading food retailer, is intensifying its efforts to bolster its private label presence in the coffee market. The company, designated a major supplier by the Competition Authority two years ago, is broadening its range of private label coffee products to challenge established brands like Strauss and Osem.
This initiative, which began about a year ago with the launch of private label Turkish and instant coffee produced by local company Radwan, has since expanded. The company now offers ground coffee and Nespresso-compatible capsules imported from Italy, Switzerland, and Slovenia.
Recognizing the high brand loyalty in the coffee category, Shufersal is pricing its private label products significantly lower than leading brands. For instance, its private label Turkish coffee is offered at two units for NIS 15, compared to NIS 11.5 for a single unit of Elite Turkish coffee. A 200-gram jar of its private label ground coffee costs NIS 20, while a similar size of Taster's Choice is around NIS 36.
The company identified an opportunity due to a sharp increase in coffee prices over the past two years, primarily driven by Strauss, which raised prices twice by double-digit percentages. Despite a global decrease in coffee prices, consumer prices in Israel have not fallen, with Strauss citing commitments to inventory purchased at higher costs and a gradual impact from raw material price drops due to its purchasing policy.
Shufersal's extensive network of hundreds of stores nationwide and its strong online presence allow it to expose consumers to these price differences. The company stated that true competition in the food and retail market is measured by price, quality, and variety, and its expansion into private label coffee reflects its strategy to offer quality alternatives at competitive prices, thereby encouraging competition and providing value to Israeli consumers.
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