IndiaRetailBiz

Kishore Biyani owned Big Bazaar and Food Bazaar retail chains, part of the Future Group, which have stopped stocking PepsiCo owned Frito Lay’s wafers and other snack products, on account of margin disputes, have now been replaced by ITC’s “Bingo” snack products, report PTI.

Although, discussions to sort out margin related issues between Frito Lay and the Future group are believed to be in progress, none of the Lay’s products are available at any of the 57 Big Bazaar and 70 Food Bazaar stores.

To make the matters worse for Frito Lay, the Future group has also introduced snacks in its private label called ‘Tasty Treat.’

As reported earlier, the problem appears to have arisen on account of regular discount offers on Lay products given by the retailer, which was not taken kindly by small kirana merchants, who account for bulk of brand’s revenues. Frito Lay is also said to be not inclined to increase the margins of the Future group, to compensate for discounts given on their products.

Bingo, according to knowledgeable sources, has become the brand of choice as PepsiCo is believed to have asked for a reduction of 5% in margin from 25% to 20%.

In order to garner a decent share of the wafers market, which is dominated by the MNC brand, apart from a high voltage advertising campaign, ITC is offering about 5% higher margin than Frito Lay.