2023-07-22 03:10:03
The large grocery chains Rewe (Billa, Billa-Plus, Penny, Adeg), Spar and Hofer confirmed the OÖN report on falling purchase and wholesale prices on Friday. They assure you that they will pass this on to customers as quickly as possible: “1:1”, “as soon as possible” and “by return mail” they say, unsurprisingly, when asked.
Since the beginning of the year, Billa has already priced more than 700 products and published them on the website with the name and price and the date of the price reduction. A number of products on the milk shelf are currently cheaper, but so are cleaning utensils such as curtain white or toilet foam by 20 cents per pack, pipe cleaners by 40 cents per liter (to 4.59 euros). Hofer reports that more than 450 items have been reduced in price since the beginning of the year, and at Spar there are “hundreds”.
Nevertheless, it sometimes takes a while before lower wholesale prices have an effect on consumers in the stock market. Spar spokeswoman Nicole Berkmann uses frozen pizza as an example. Frozen products are produced and purchased by manufacturers on a very large scale because they keep for a long time. “We bought the products that are currently in the refrigerated display case at a higher price. A price reduction by the manufacturer can therefore reach the customer with a delay.”
The chains all confirm that the negotiations with the producers are more difficult than ever. “Because the manufacturers are there quickly when it comes to price increases, but it is more difficult to achieve price reductions.”
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In addition, a number of manufacturers are now trying to push through price increases for a variety of reasons. Rewe spokesman Paul Pöttschacher: “We only see relaxation in certain product groups such as dairy products. We are still confronted with price demands from the food industry. But customers can be sure that we will continue to negotiate hard with our suppliers.”
He also points out that according to Agenda Austria, the price increases for food in Austria between March 2022 and March 2023 were less pronounced than in most other EU countries: 14.6 percent food inflation. In Hungary it was 45 percent, in Poland, the Czech Republic and Latvia around 25 percent.
Differences in organic products
In general, Austria’s organic segment is showing slight declines. Not so at Rewe. “The demand for organic products is increasing slightly here, but it is.” Both in sales and in quantity, where there is a slight plus. Spar, on the other hand, reports a slightly lower demand for organic products compared to the previous year. “The price developments are similar to those in the conventional range.” Hofer answers the question regarding the development of the organic segment with: “satisfactory demand”.
All three chains surveyed defended the higher prices of Austrian retailers compared to Germany, which are often brought up by the Chamber of Labor and consumer protection groups.
Among other things, they mention the higher logistics and location costs due to the country’s geography and population distribution. “We don’t have a supermarket catchment area of a few hundred thousand people like the Germans do,” says Pöttschacher. The result is a higher branch density with smaller locations and thus higher costs. The international food companies know regarding the relatively small quantities of the Austrian chains – and therefore do not let their pants down when negotiating prices as much as with the Germans, French or Italians. Not to be underestimated: Austrians buy a lot in action: 40 percent share of sales compared to 13 percent in Germany.
author
Ulrike Rubasch
Editor Economics
Ulrike Rubasch
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