The world's largest food group, Nestlé, says prices for products will increase yet again in 2023 amid rising inflation and hikes in the cost of goods throughout the global economy.
Last year, the mega conglomerate increased prices by 8.2%, joining other large companies including Heineken, Colgate-Palmolive and Proctor & Gamble who all say they will further increase the price of goods in 2023.
Nestlé CEO Mark Schneider told reporters on Thursday that “intense negotiations are taking place" with retailers and he said, “Everyone has the same goal and that is to shield the consumer from excessive inflation."
Nestlé said it expects "organic sales growth" between 6% and 8% in 2023 with an underlying trade operations profit margin that would fall somewhere between 17% and 17.5%.
Schneider said, "we expect another year of robust organic growth, with a focus on restoring our gross margin, stepping up marketing investments and increasing free cash flow. Nestlé’s value creation model puts us in a strong position to achieve our 2025 targets and to generate reliable, sustainable shareholder returns."
Schneider didn't go into many details about the company's negotiatons with retailers while speaking to reporters on a Thursday earnings call.
Underlying costs like the cost of energy, grains and dairy still remain high and have been blamed for price increases.