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Where does “supply and demand” end and “rip off prices” begin?

Our esteemed Minister for Trade, Enterprise and (rising un)Employment has promised to get to the bottom of our high prices being suffered by Irish consumers. I thought this was the reason he set up the National Consumer Agency a number of years ago. Are they unsuccessful at what they’re supposed to be doing, or as suggested by our friend Leo, is he stalling for time? But why would he be stalling for time? Waiting for prices to fall on their own?

According to this breakingnews.ie item:

Minister for Enterprise Micheál Martin is promising further investigation into why Irish consumers continue to pay higher prices for essential goods and services than their EU counterparts.

Mr Martin was speaking about a new Forfas report on the effects of the EU single market.

The report says that, while the single market has benefited business and trade, Irish consumers have been left with some of the highest prices in the EU.

Maybe he could listen to Dermott Jewell, Chief Executive of the Consumer Association of Ireland. Mr. Jewell was today quoted in an Irish Independent article referring to the cost of roses for Valentines Day – reported doubling in price compared to every other day.

Faced with the issue of retailers increasing their prices, Mr.Jewell responded “The distributors put it back to the growers and there is a bit of truth in that but, let’s be honest, every single person on that chain is trying to make as much money as they can.”

And more crucially, “It’s seen as an opportunity to extract as much money from the Irish consumer as possible,” he added.

And why do retailers do that? Because they can maybe? Because no matter what the price charged, Irish consumers will unquestioningly hand over the cash? The Indo article above is a good example.

Without seeing the direct comparison myself, how many people could really tell the difference between 12 €120 roses from a specialist florist in a vase compared to 12 €30 roses from Dunnes? So why spend the extra €90? Convenience? Snobbery? Or do some people show their love purely through monetary expenditure? Any way you look at it, it’s the consumers choice to pay that extra €90, so they’re not really in a strong position to complain – especially when there are valid and cheaper alternatives available.

If consumers don’t pay the specialist florist €120 for 12 roses, they won’t sell them. If a florist isn’t selling roses, they’ll have to do something – stop selling roses, or drop the prices to attract customers. As the Indo article says, it’s simple supply and demand.

We shouldn’t be only slagging off Irish retailers for the high prices they’re charging. We should also be slagging off all the Irish consumers who are stupid enough to spend such high prices and create demand at these high prices – thereby causing the rest of us to have to pay these prices as well.

3 comments On Where does “supply and demand” end and “rip off prices” begin?

  • Last year I bought my gf a dozen roses from a good florist, and they cost over €100. When I asked the florist why they were twice as expensive as the last time I bought a dozen roses – I’m a sekrit romantik – she blamed the growers. This year I bought her a dozen from Tesco on Tuesday for €50, which in my opinion are nicer than the ones from the mainstream florists. The gf thinks so too, and it’s she taught me about looking for value so I don’t get accused of being cheap. When the Tesco roses start looking a bit dodgy, I’ll replace them with more out of the balance.

    Sadly, before I’d met the gf, none of this would have occurred to me. I’d just continue buying the expensive ones and bitch about it. We need to think more about end-routing the scams that are running in this country. But of course then we have to wonder about where the cheaper products are coming from. It’s a tricky business.


  • adam:

    a great comment, but I fear you fell at the final hurdle: it’s not a scam if it’s up front and you go ahead and pay anyway. Some would argue it’s not a scam even if it’s *not* up front. If people don’t pay the allegedly rip-off prices they’re being charged, the retailers have no choice but to drop those prices.

  • Price fixing is a scam waider. There’s zero doubt in my mind that price fixing is happening in Ireland at levels unseen for decades.


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