The average shopping cart has become significantly more expensive over the past year and it looks like this price increase will continue into 2023. Prices are currently about 14% higher than at the end of 2021 and won’t get much cheaper, she thinks of marketing and retail Kitty Koelemeijer of Nyenrode.
It’s because of inflation, he thinks. ‘Even though the inflation rate is coming down, we still haven’t gotten rid of the price hikes as we’ve seen them. So I think prices will go up for a while.’
And this seems strange. According to the European statistical agency Eurostat, inflation is decreasing, but food prices are rising. Exactly what you don’t expect. Koelemeijer is supported in this by the co-founder Joris Beckers of the online supermarket Picnic. “The 14 percent increase is worrying to see and if it continues like this it can add a lot. Before you know it, we’ll only pay 25% more for the food.’
Causes
According to Beckers, all kinds of causes can be invented, which he also calls legitimate. For example, rising energy costs play a major role in rising food prices, but so does the fact that branded manufacturers make it difficult to purchase products in other countries. “They charge different prices in different countries, even if they themselves benefit from the European market by building a factory.”
But while the producer benefits from the low cost of a single factory and efficient production, the consumer does not, Beckers continues. “Products in Germany are often a third cheaper than in the Netherlands,” he says. “If Dutch consumers paid German prices, there would be no inflation in the food country this year.”
No longer sustainable
Koelemeijer agrees: “This topic has been around for much longer and I personally think it’s no longer tenable,” she says. ‘What you see is that big manufacturers don’t think by country, they think globally. And in one market there is more purchasing power and price elasticity is different, and these so-called territorial constraints of supply – a form of trade barrier – allow producers to maximize their profit.’
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
