Amid outcry, Shufersal suspends cut-price website for haredim

Itzik Abercohen  credit: Shlomi Yosef
Itzik Abercohen credit: Shlomi Yosef

The move follows applications for class actions after Channel 10 exposed large price gaps between the Yashir Lamehadrin site and Shufersal's regular website.

After the outcry and the class actions comes the stage at which supermarket chain Shufersal CEO Itzik Abercohen stands before the cameras and announces the suspension of the "secret website" exposed on television Channel 10's "Tochnit Hisachon" ("Savings Program").

On the website, called Yashir Lamehadrin, Shufersal, through its sub-chain Yesh Hesed, sells products at deep discounts on the prices on its general website through which it makes most of its online sales. Reporter Maayan Parti, who revealed the website's existence to the general public, displayed identical products, pulled from shelves at the same branch, sold at different prices on the two websites. The Yashir Lamehadrin website is aimed at the haredi (ultra-Orthodox Jewish) public, and the findings showing consistent price differentials in favor of customers shopping on that website apparently indicate discrimination between consumers on a sectorial basis.

Shufersal is the strongest supermarket chain in Israel in online sales. About a fifth of the company's sales are online, double and even quadruple the proportion at its competitors. Abercohen said recently, "In 2019, turnover from online sales was NIS 2 billion. The coronavirus pandemic hit, and in 2020 we reached NIS 3 billion. At the rate sales are going in 2021, we are maintaining the 2020 figures. We lead the food and non-food segments online, and we shall continue to lead."

After the "Tochnit Hisachon" program was broadcast, the storm was not long in coming, and hundreds of people posted angry responses calling for a boycott of Shufersal, and displaying the gap between the prices of products they bought regularly on the main Shufersal website and prices of the same basket of products on the "Yashir Lamehadrin" site.

"Transparency and fairness and important to Shufersal"

The Yashir Lamehadrin site will now be suspended. In his videoed response to the exposé, Abercohen said, "Figures were recently published on price gaps on the Yashir Lamehadrin website of Shufersal's Yesh Hesed chain, which is aimed at a sector that seeks a high standard of kashrut, and in which there are families with many children in comparison with the population in general.

"The figures as presented in the report are problematic. In the light of this, I have decided to halt the activity of the Yashir Lamehadrin website. We shall study the scope of the disparities between the Yashir Lamehadrin site and the general website. At this stage we will not expand the activity of Yashir Lamehadrin to other parts of Israel. We shall freeze the activity for a period of time and after that we shall launch a new operating model.

"I'm grateful that the incident has been referred to us. We shall analyze it, and learn the lessons. Transparency and fairness and important to Shufersal and to me personally.," Abercohen said.

Yesterday and this morning, two applications for class actions against Shufersal were filed, amounting to hundreds of millions of shekels, alleging prohibited discrimination in favor of the haredi community. The claimants said they had found price differences between Yashir Lamehadrin and Shufersal's general website of 10% on over 1,100 items, 15% on 665 items, and 20% or more on 320 items.

For example, a large doughnut was for sale at NIS 2.90 on the Yashir Lamehadrin site and NIS 5.90 on the Shufersal Online site - a gap of 103%. Frozen salmon steak was sold on Yashir Lamehadrin for NIS 39.90, and on Shufersal Online for NIS 64.90, a gap of 62%. A liter of olive oil was sold on Yashir Lamehadrinn for NIS 29.90, versus NIS 39.90 on Shufersal Online, a gap of 33%.

The claimants said that Shufersal was thereby in breach of several laws, among them anti-discrimination legislation and the Consumer Protection Law.

Shuferal said in a statement: "We have not yet received the statement of claim, and if this claim is filed, we shall deliver our response in court."

Published by Globes, Israel business news - - on November 4, 2021.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2021.

Itzik Abercohen  credit: Shlomi Yosef
Itzik Abercohen credit: Shlomi Yosef
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