Everything is becoming more expensive, it is always a squeeze when you arrive at the checkout after a round of the supermarket. Will this prize storm ever end? And if supermarkets earned so much money during corona, why do we as consumers not notice it? We posed five questions about these sky-high prices to two experts.
Will supermarket prices ever go down?
To start with, the higher prices are a result of several factors, explains market researcher Norman Buysse of GfK: “We had COVID, which caused the flow of goods to become unbalanced. People started to hoard, there were shortages and that pushed prices up. Now the war and rising energy prices play a part.”
That war is causing shortages of raw materials, such as grain and oils such as sunflower oil. Transport and energy costs are also rising, all higher costs are passed on to the consumer. “There is a lot of competition, people can choose between supermarkets so if prices can go down, they will. I don’t expect it to happen this year, but as soon as it can. †
Peter ter Hark agrees. “Supermarkets do everything they can to get the lowest prices. But we are completely dependent on what happens in the world.”
Why has everything become so much more expensive in the supermarkets, while they have earned so much money in corona time?
This addition is not as simple as it seems, as it turns out. Because supermarkets did have ten percent more turnover in times of corona, but they also incurred higher costs, says Buysse: “Products are more expensive, just like energy prices and transport. Prices have hardly increased during corona time. It will take a while before price increases reach the consumer, I expect that we are now at a bit of a peak.”
From a social point of view you would expect supermarkets to give something back, but it doesn’t work like that economically, says Ter Hark. “Supermarkets always use almost the same margin, which is about 25 percent gross. As an example: suppose you buy something for two euros, then it is purchased for 1.50 euros. Of that 50 cents, all expenses such as personnel and real estate must be paid. The profits are used to absorb setbacks and they are there to fill the cash register.”
Sometimes it seems that packaging has become smaller, is that correct?
According to Buysse, this is certainly possible, because it is also a way of saving costs for a supermarket or a manufacturer. “Supermarkets take the time to pass on the costs, they look at what is happening around them and then determine how they deal with the price increases. Reducing packaging can also be a tactic. It is therefore wise to take a good look at the volume of a packaging. You often see new packaging with ‘improved recipe’ on it, then you have to pay attention to how much is in it.”
Is it worth switching supermarkets?
The price differences between supermarkets are not huge, but it can pay to visit different stores. “The purchasing price of products is almost the same for supermarkets, there is no difference. What does make a difference are the costs incurred by supermarkets. You can see that in the stores, in the decoration and a lower service level,” says Ter Hark. And that results in slightly lower prices at discount stores, among others.
It is also worth sifting through the advertising brochures. “Supermarkets make little profit on these promotional products, the promotions are mainly there to bring in customers. If you take a tour of different supermarkets with offers, it certainly makes a difference.”
Are there products in the supermarket that are cheaper?
Buysse: “No, I don’t expect that. For all products, there are rising energy prices and those costs are passed on.”
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