By George Lampiris
Foods are in a rally of constant price increases, especially from the beginning of the year until now. However, this fact, in combination with the shocks and the increase of costs in the energy and fuel sector, have reduced the purchasing power of consumers, resulting in the contraction of sales in volume by about 8% in April in Greek supermarkets.
Indicative is the quarterly survey of EV in a sample of 18,000 consumers, which finds that the rising cost of goods and services affects the purchasing power and decisions of 52% of respondents worldwide.
In addition, data that reflect the broader trend of price increases in certain food categories are also reflected through a recent NielsenIQ count, which focuses on the Easter period. It is characteristic that in the week before Easter, which ended on April 24, poultry and chicken recorded higher sales in value by 5.5% and 5.7% respectively. This is largely due to price increases in these categories of goods, which contrasts with the reduction in market consumption. At the same time products such as vegetables remained at the same level as last year in terms of turnover, however tomatoes increased their turnover during the reporting period by 11.6%, cucumber by 17.2% and lettuce by 33.2%, making up the products that have received the largest increases.
Picture of two gears on the shelves
According to the managing director of the Metro group, Aristotelis Panteliadis, the market of Greek supermarkets in April fell in volume by 8%, with stability in sales turnover, which is attributed to the increase in prices. Regarding the promotions of the industry on the shelves of supermarkets, Mr. Panteliadis pointed out that there is a double image at the moment in the market. “Those of our suppliers who can, continue to do promotions and those who can not have stopped. In essence, this means that those who have absorbed much of the cost increase on the shelves, have reduced or even stopped the promotions, while those who have passed racks, have tried to offset the price hikes by stepping up promotions. ” As he characteristically noted: “everyone is currently putting their hand in their pocket”.
Increased prices for food and non-alcoholic beverages by 10.9% in April
It will be recalled that last week ELSTAT announced an increase of the general consumer price index by 10.2% in April compared to the corresponding month of 2021. This is due, among other things, to the increase in prices of food and non-alcoholic beverages by 10.9% in the specific month.
Agrino: Increase in all products from 5% to 7%
On the issue of price increases, Agrino’s managing director and marketing and export director, Agis Pistiolas, says his company has already seen a 5% to 7% increase in all its products – rice and legumes – which it has It happened gradually from November 2021 to January 2022. However, at the moment Agrino is on hold and waiting before taking its next steps, with Mr. Pistiola noting that the company has tried and absorbed a significant part of the existing costs. .
3alpha: 6% increases in legumes and rice
Costas Karageorgiou, general manager of 3alfa, another large company in the field of legumes and rice, points out that the increases made by his company at the end of February amount to an average of 6%. The total cost increase in all operating lines of the company averages 45%, while according to him the cost increase in legumes has reached 35%.
Pasta Helios: At 23% the total price increase since November
In the pasta industry, the company Ilios was late in making price increases despite the fact that increases in durum wheat, which is the raw material for its products, had already begun to appear from September 2021. “However, we passed the first increases in pasta in November “, says Athanasia Dakou, commercial director and member of the industry board.
The first increase in November was of the order of 15% and was followed by a new price adjustment in January 2022 with about 8%. “We expect from our side to see how the conditions will develop in order to determine our next moves”, adds Mrs. Dakou.
“It does not look like we will have a drop in prices”
“This is an agricultural product and in no case can we have a clear picture before the new harvest. In addition, world grain stocks are currently at a low level, which is a key indicator that confirms that we will not have a reduction in prices.” says the businesswoman.
Coffee Island: Reduce coffee consumption in stores
A different case of a business related to retail is the coffee chain, Coffee Island. The company, which maintains 473 coffee and beverage outlets in Greece and abroad, has seen an increase in the burden in all sectors – raw material, transportation costs, energy – which on average amounts to 35%, according to the general manager of the company, Alexandros Zapanioti. Mr. Zapaniotis notes that at this time there is a decline in coffee consumption in the chain stores due to strong inflationary trends prevailing in the market. Coffee Island executives are waiting for the arrival of the tourist season to see signs of recovery in demand.
Coffee market subsidy – Tough competition landscape
Characteristic of the market trend is the fact that Coffee Island has chosen to premium the coffee market, in order to attract customers to its stores against the competition. This practically means that a fredo espresso coffee costs 1.90 euros in its stores, however the company makes a 0.10 euro discount for anyone who brings their own glass. An additional 0.10 euros is deducted from the above amount from the environmental fee imposed on the glass and the coffee cap. This practically means that the price of her coffee is 1.70 euros, while the whole competition at the moment in take away sells for 2 euros or more this coffee. However, the strong discount policy applied by this company demonstrates the image that prevails in this market, where there is a significant number of brand chains in recent years, a fact that has further intensified competition and the price game.