Price Cuts on Foreign Milk Brands Failed in Increasing Purchases
Even with the recent price cut in foreign milk formula, parents didn’t show any excitement as Wyeth, Friso and Dumex cut down their formula prices as much as ten percent on average. But even with these price cuts parents still complain that its not enough and usually these price cuts are PR stunts amid government investigations.
Experts say that the price cuts are in response of the anti trust probe that is conducted by country’s top economic planner into several foreign baby formula brands. The National development and Reform Commission is doing its investigation on companies that are believed in monopolizing the Chinese market. Wyeth said that a self investigation that they conducted found suspected price control are done by dealers and retailers, this prompted them to cut prices on it main formula products as much as 11 percent on average and the maximum decrease will be around 20 percent. French supermarket Carrefour said that he company have already informed them of the price cut, while some other have still to announce price cuts but nonetheless began offering discounts.
Parents are accusing foreign brands of cutting prices only on their limited formula products and leaving prices of regular formulas unchanged. And because of these it still failed to increase purchases from local parents.