Reported news of PepsiCo’s proposed price hike for its Lay’s potato chips and Cheetos puffs has made millions of Chinese consumers frown, some lamenting increased costs for the snacks as life and work pressure continue to mount in China.
The news of the Lay’s potato chips price hike garnered 260 million reads and 320,000 discussions on Sina Weibo in a matter of days after media reports claiming PepsiCo has informed its retail partners about the price hike, to come into efffect in May.
The company reportedly said the price rises were due to rising costs for sugar, packaging and labor.
Many netizens expressed regret, with some saying they plan to switch to other brands and others say they will hoard chips before the reported May price hike.
Many said chips are becoming a luxury to them and suggested PepsiCo should choose an indirect hike such as the reducing net weights per package rather than direct price hikes.
“Like tissues, potato chips are a daily necessity to me. They help me to reduce pressure. Lay’s price hike is a blow to me, as I already face the pressure of housing mortgage loan payments and increasingly long working hours,” a Beijing-based white-collar worker surnamed Shen told the Global Times on Sunday.
PepsiCo’s proposed price hikes come as a number of daily foods in the fast-moving consumer goods category hiked prices in 2018, including beer, instant noodles, coffee, and preserved pickles.
Yan Qiang, an observer of the food industry, said for foods like chips, most consumers will likely continue to buy them. “PepsiCo must have factored in its leading position in the market to make the decision on price hikes. Due to the low value of a single package of potato chips, a small hike will be translated into a decent rise in margins,” Yan said.
Zhu Danpeng, a Guangzhou-based food industry analyst, told the Global Times Sunday that the new generation of Chinese consumers is not “price sensitive”. “I doubt Lay’s sales will be affected at all. The new consumers care about sensation. They buy what they like,” Zhu noted.
Source: Global Times