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Netherlands: Customers more often opt for PL and discounters know that groceries remain expensive

Updated: Aug 1, 2023

The prices of our groceries will remain at a high level in the coming months. As a result, consumers are buying more and more creatively. They more often opt for private labels and buy their products from discounters or other low-cost carriers.


"At the beginning of this year, there was still a slight decrease. But if we look at the period from January to June, the prices of our groceries remain at a stable high level," says Eric Harmsen of research firm GfK. "That means that on balance prices are 11 to 12 percent higher than last year."


Food prices rose by 11.6 percent in July, making them the main drivers of inflation in the Netherlands, according to figures from statistics agency CBS. Supermarkets benefited from this and saw their turnover increase by 12 percent.


According to Harmsen, due to the rise in raw material and energy prices, we will continue to pay more for food and drink in the coming months. "As a result, certain products have become more expensive, such as pasta. They also notice this in Italy, for example. Energy prices are now falling, but suppliers have contracts for a longer period of time."


Economist Jan-Paul van de Kerke of ABN AMRO agrees. "Energy and raw material costs have risen sharply and that is being passed on throughout the chain. That ultimately affects the consumer."


Van de Kerke also notes that the increased wage costs play an increasingly important role. Wages in the supermarket sector have also risen by around 10 percent. "That ultimately drives up prices a bit."


Consumers opt for private labels

GfK researcher Harmsen says that since the beginning of this year, consumers have more often opted for private labels. "For the first time, the turnover of these products is higher than that of A-brands."


Trade association Centraal Bureau Levensmiddelenhandel (CBL) emphasizes that supermarkets do everything they can to keep prices for consumers as low as possible.

"The food that supermarkets buy and resell to consumers has often come a long way. From the raw materials for animal feed to grain for biscuits and breakfast products and the tomatoes for pizza. Many products also need to be packaged, cooled, heated and transported," explains a spokesperson.


'In the end, everything is connected'

"The many hundreds of thousands of companies involved in the production and distribution of food worldwide have recently had to deal with sharply rising costs for energy, rent, logistics and production. Personnel costs have also risen sharply. At the end of the day, everything is interrelated and that is reflected in the price that a consumer pays in the store for his shopping basket."


The CBL expects the geopolitical unrest to continue and the markets to remain disrupted for an extended period of time. The sector association for supermarkets calls on all parties in the food chain to bear part of the increased costs, so that not everything ends up on the consumer's plate.






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