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Consumer goods importer Diplomat suspends price increases

After announcing a price hike and coming under fire from major retail chains, the Histadrut (General Federation of Labor in Israel) and the public, consumer goods importer Diplomat Holdings (TASE: DIPL) said that it freezes the movement. The company said it would not raise prices for its brands until the end of the Jewish holiday season, which ends in late October. The announcement covers all the products that have hit the headlines in recent weeks due to their rising prices.

After negotiations with retail chains, Diplomat has decided to discount products on its new price list until after the holidays, so that the price to the consumer remains unchanged.

Diplomat said in a statement last night: “Over the past few days, Diplomat has offered all of its retail customers a plan containing ongoing discounts, so that the consumer can benefit from previous prices until after the holidays. Customers who do not approve the proposal will not be provided. It is important to emphasize that Diplomat encourages competition and does everything in its power to deal with it in a professional and honest manner. Diplomat makes great efforts to avoid raise prices, but because of inflation and rising global input prices, it has only partially succeeded.

“We emphasize that Diplomat is an Israeli company operating in five countries and employing 2,500 people, including 750 in Israel, and that it must maintain a minimum of financial strength in order to ensure the well-being of its employees and shareholders, that include the public.

For its part, the Histadrut does not intend to give up its protest against the rise in prices. Diplomat’s announcement, which does not unambiguously declare a price freeze, does not signal the end of the campaign for him. “The campaign we embarked on last week is a long one and it will continue, and despite Diplomat’s vague announcement which promises nothing to the general public, the campaign is going full steam ahead,” the Histadrut said.

Last night, representatives of the Histadrut, the Association of Pensioners, social activists and members of the public demonstrated against the rising cost of living outside the home of Ron Tomer, president of the Association of Manufacturers of Israel, in the Nevei Avivim neighborhood of Tel Aviv. Tomer went to meet the protesters and had a long conversation with them.

“This morning we launched a grassroots campaign that will help consumers fight extortion in the cost of living, and tonight we are demonstrating outside Ron Tomer’s house. The campaign will continue and intensify in the next few days until companies realize the party is over and stop extorting consumers,” said Histadrut Chairman Arnon Bar-David. Unless active operational measures are introduced in this case, at the beginning of September I will summon the Histadrut institutions to declare a labor dispute in the economy.”

Eyal Ravid, CEO of supermarket chain Victory, said in response to Diplomat’s announcement: “As I have been saying for the past few days, this is the consumer’s moment. The power to bring about change is between the hands of consumers, and that’s a good thing. This victory is a saving for all of us. There will be no price increases in the Victory chain, and the goods will continue to be on the shelves to withstand test of consumer choice.

Published by Globes, Israel business news – en.globes.co.il – on August 2, 2022.

© Copyright Globes Publisher Itonut (1983) Ltd., 2022.