He made a name for himself by defending the purchasing power of his customers. Michel-Edouard Leclerc, president of the strategic committee of the E. Leclerc centers, has been essential since receipts have been at the forefront of French people’s concerns. The brand recently published a study that focuses on the worrying consequences of inflation for those under 30, the starting point for the interview he gave us.
According to the latest study by the Leclerc Observatory of New Consumption, 49% of 18-30 year olds are pessimistic about the evolution of their purchasing power. Are you also pessimistic?
Michel-Edouard Leclerc: Me, I am combative and creative. And I think it has to be because it will rock quite a bit for the purchasing power of households, but also, consequently, for businesses. Recession must be avoided at all costs and I feel it my duty to help companies get out of this crisis. Distributors have a social utility to promote.
Those under 30 seem specifically affected. Also in your study, one in three young people said they regularly skip meals due to a lack of resources… Do you notice these difficulties at the checkout?
Yes, the increase in precariousness translates into very visible behavior in stores. It’s obvious, we see the poorest young people looking for first prizes whose presence had greatly diminished on the shelves. And that’s why, moreover, we put all our first price ranges back on the drive. It is often said that the previous generation was fascinated by brands, sometimes to the detriment of its purchasing power. Today the younger generation is very pragmatic. She has no complex buying a first-price product.
However, it is also a committed generation, in particular for a healthier and more environmentally friendly diet…
Buying a budget product is not synonymous with giving up quality food, but yes, it is a generation that has these aspirations and it does not always have the means to put them into practice. As a result, this results in enormous frustration.
You feared a very turbulent social return. Does it stem from this frustration?
Beyond youth, it is society as a whole that needs to be looked at. The climate of this return to school is dominated by the rediscovered desire during the holidays to fully live a mobile and Covid-free life. But unfortunately ! Public and media discourse focuses on two announced crises, inflation and energy. We are immersed in this climate of anxiety and there are not many ways out for the poorest.
Do you have a role to play in this sequence?
Let’s say that it challenges me and it empowers me. So I call on my colleagues at Leclerc, but also on all entrepreneurs to take action. Because there are many things to do. We are going to have a difficult winter. Before consumers receive injunctions, it is up to us to be exemplary and to better control our consumption because it is the companies that consume the most.
What do you plan to do on your side?
In terms of lighting, heating, or even the regulation of heat flows, Leclerc will take about fifteen measures even before the arrival of winter. It is a sobriety plan which, if carried out well, can reduce consumption by the equivalent of approximately 24,000 households. Moreover, it is our interest. An average hypermarket has an energy bill of €500,000. With the coming rise in electricity costs, this could go up to triple in 2023.
And against the other crisis, inflation?
Today, manufacturers are trying to get us to raise bills, sometimes without reason and without justification. As we know, there are cost increases everywhere, whether because of the war in Ukraine, speculation or the disorganization of the markets. Inflation is inevitable, but the rate of inflation is negotiable. I mean that our job, as distributors, is to protect our consumers! Leclerc has 18 million customers. I want people who come to shop with us and discover the price increases to know that we have done everything to cushion them.
Is it the return to hard negotiation with suppliers, the one that has often been criticized for supermarkets?
The public trusts us to keep prices rising as little as possible. And so yes, we negotiate. Some manufacturers have good arguments, but overall there is a lot of opacity in their demands. We have the impression that everyone is trying to pass increases very quickly because they know that afterwards, consumers will scream. We hold on and we sometimes have supply shortages. This is the return of the negotiators. And besides, manufacturers would also be well advised to reactivate their purchasing department and get out of the lethargy of the Covid.
How do we ensure that we don’t go too far in the negotiation, especially with farmers who need a certain level of price to live?
First of all, it must be recognized that for breeders in particular, production conditions are difficult. We could also have expected the grain farmers to give them some discounts anyway, that there was a little solidarity between them. Then, it should be remembered that the FNSEA wanted a law, EGAlim 2, which protects agricultural production costs. Let the State assume its responsibilities! We do not dispute the rise in agricultural prices and therefore if there are demands to be made, let them be made. If the price of milk has to rise, let it rise. But we don’t buy from the farm, our suppliers are manufacturers, so I’m not sure we’re the right person to contact for these requests…
If these requests are addressed to you, it is also because you have chosen to embody the fight for purchasing power…
Yes, I personalize the commitments of our brand a lot. And I can tell you that all this summer on the Tour de France, whether we’re sponsoring it or in my Brittany, when I’m going to run on the GR 34, the people I meet give me a thumbs up and tell me “don’t give up!” You know, when I am auditioned at the National Assembly, I have in front of me deputies or senators who tell me that I have to let go of all the increases from industrialists currently. OK. But when these same people return to their town, they have to face canteen managers who ask them for subsidies so that the price of the menus does not increase. And there, they rediscover the truth of costs and prices for families. So yes, that we revalue for French farmers and SMEs. But when it comes to big companies, big manufacturers, I don’t find it very moral to ask for price increases and then to demand a food check paid from public funds. I would like everyone to get out of double talk. Anyway, mine is clear.