Tag Archive - grocery prices

Grocery Prices – the Australian situation and current controversy

There is an interesting controversy breaking in the consumer affairs / grocery prices area in Australia at the moment.

There, the government had set up and funded a grocery price comparison website called Grocery Choice. The site was originally set up in 2008 with the aim of helping “consumers compare the general price levels of supermarket chains in their area”.

The Australian equivalent of the Irish Consumers Association of Ireland, Consumer Choice, was contracted by the government to take on the running of the site once it was set up. Consumer Choice was tasked with improving the relevance and performance of the site and its contents.

The Grocery Choice website is available here and details of their methodology is available here.

Essentially, the Grocery Choice website is the Australian equivalent of the Irish National Consumer Agency grocery price comparison surveys but with key differences.

The Australian survey is carried out monthly instead of twice a year here in Ireland. The Australian survey provides a regional breakdown of prices as well as a breakdown by supermarket chain.

The reason for the controversy – the Australian government has cancelled its support and funding for this Grocery Choice initiative.

And the reason for the closure of the site? It’s not up to date enough – despite being monthly and surveying more than 600 stores. So, while our government and the National Consumer Agency are proud of their 6-monthly grocery price comparison surveys carried out in 13 stores out of which they take significant meaning and importance, yet according to this article, the Grocery Choice website was closed because:

The website immediately attracted criticism last year. Information was updated only once a month and price comparisons were broad and generic.
Mr Emerson (Australian Consumer Affairs Minister) had said from the outset that it was not feasible to publish reliable, timely information on grocery prices for consumers, a view held by many critics.
“The fact is that in Australia, there are thousands of supermarkets and even more thousands of grocery items,” he said.
“The information requirements would have been enormous and they’re just not feasible, in my view.”

The last NCA grocery survey was published last February, for prices in December 2008/January 2009. I guess, therefore, we can expect another survey soon enough.

There is a growing campaign in Australia calling for the government decision to be reversed with certain quarters questioning the motivations behind the closure of the site. The site was actually due for relaunch within 5 days of its closure and it was believed that the enhancements to the site for that relaunch would have made it more useful and would counteract some of the criticism mentioned above.
The closure is a roll-back on a government election campaign promise, but some are saying that it’s the undue influence of the larger grocery chains and their requirement for less price transparency that’s behind the decision.
I’m going to come back to this topic in the near future as I believe neither of these methods of grocery price comparison are sufficient, but also because I know that (in the face of certain potentially large difficulties) there is an eminently more effective, up to date, and accurate grocery price comparison methodology possible at relatively little cost to set up and with very little ongoing maintenance costs.

Comparing Ireland to France when thinking of moving home

I received this e-mail a little while ago from someone who was in the process of moving home to Ireland from France. They’d done significant research on the impact to their pocket of moving home when it came to their bills and shopping. (Before the last budget, mind you). Here’s the problems they found they’d be encountering when moving home:

I’d like to contact you to offer both my compliments and thanks to your site.

I’m moving back to Ireland after spending five years abroad – four of them in France and one of them in the UK. I’ve been planning the move back since November and found your site in December, and have been following the posts on the site since then. It’s provided a wealth of valuable information for me. I thought I’d share some thoughts about French and Irish prices, from the point of view of an average Joe, rather than a columnist in the paper. After all, the EU is supposed to be about the freedom of goods, single market, better competition and all that jazz.

France is a strange place for consumer pricing. Some areas see fierce competition, while others, for example the taxi industry, remain expensive and regularly.

Home telecom and internet sees, in my opinion, the best competition with excellent prices available.I am with a company called free who provide me with telephone, internet and television for 29.99 per month. There are hundreds of stations to choose from, the internet is 24mb speed with no download cap, and the phone calls to most EU and several international landlines are completely free. In comparison one of the best similar deals I can find in Ireland is with ChrousNTL, which will cost me 77 euro a month, and won’t include free EU or international calls – with close family in the US, UK and Spain as well as Ireland, this will be a disappointing drop in value. Not only will the base cost be more than double what I’m paying here, I will still need to factor in the cost of calls to the aforementioned countries.

Next up with have electricity. Electricity in France is reasonably priced, and that’s even with the default company, EDF. My current scheme runs on a yearly basis – I pay a fixed fee every month from my bank based on average usage for 11 months of the year, then it’s tallied at the 12th month. According to my last paper bill in August 2008, the origin of the previous year’s electricity was 87% Nuclear, 7.1% renewables of which 5.7% was hydro electric, 3.7% carbon, 3.2% gas, 1.5% fuel and 0.3% others. Wiki tells me that high % of nuclear power is a result of the 1973 oil crisis badly affecting the country. So, let’s see what sort of cost all that nuclear energy gives consumers.

Usage
August 2005 – August 2006: 2149 kWh – Cost: €300 approx – harder to calculate as EDF was still linked with gas bill and I had gas on the same bill.
August 2006 – August 2007: 2393 kWh – Cost: €318.09
August 2007 – August 2008: 2614 kWh – Cost: €346
August 2008 – August 2009: 2592 kWh – Cost: €360- obviously this is based on presumed usage, but I’m paying for this figure on a monthly basis at any rate.

These include the unit rate, and each year I’ve paid 12-14 euro for other fees.

My bill states that I pay just over 7 cent a unit, but the price plan i’m on seems to be represent the actual price of about  €0.1350 cent a unit. Not that much cheaper than the ESB clocking in at €0.1640 – yet the difference adds up; for my current estimate of usage it would be €425.08 with the ESB for the electricity alone.however this doesn’t include the standing charge, which makes no appearance on a French bill. This is approximately €0.28602 including vat (all my prices include vat, and on French sites TTC indicates vat included) for a year this amounts to another €104.39, bringing the total bill to €529.47 with ESB We are surrounded by wind and waves that could provide a cheaper and sustainable source of electricity…
On this note, I gather prices will drop; I noticed a large series of campaigns by Bord Gais about bringing cheaper energy to the market.

Mobile phone – here’s one where Ireland beats France, but where the UK stands ahead. I’ve included the UK  Offers there trump France and Ireland by a long shot. I’ve included them as I’ve lived there in the past, and have family there to compare deals with. I checked out the following links in anticipation of moving back for a phone I’ve fancied, and posted the best deals I could find in each country for a mix of text and minutes.

UK contracts for LG U990 touchscreen phone:

1) Free phone – 100 minutes and unlimited texts per month, £20 a month for 18 months with 3 telecom.

OR

2)
Free phone – 400 minutes and 500 texts, £29.37/month but 7 month free rebate means it averages at £17.95 per month for 18 months with o2

Ireland contracts for same phone with 3 telecom.

€149 phone – 90 mins OR 270 texts, €19 a month for 12 months
or
€129 phone – 150 mins OR 450 texts, €29 a month for 12 months

As you can see, you receive a lot more in the UK. Against France, Ireland wins out. The offers here are many and convoluted, especially with Orange. The same phone on a 1 year contract with Orange France costs 79 euro and has several contract methods. €18 a month contract gets you 40 minutes to mobiles and national numbers, or “unlimited texts” between 1600 and 2000. €21 gets you 60 minutes or “unlimited texts” between 1600 and 2000. The issue is the texts aren’t unlimited – you can convert your minutes to a fixed block of texts, 150 and 180 respectively. Higher packages similiarly yield more poor results.

Groceries - sadly I left my notepad in Ireland with the prices I had mentioned, So I can’t comment too much here. For an overall feel of prices, I’ve found France cheaper in general for all goods such as day to day shopping, or things from the electronics section in the supermarket. Without the exact prices to hand, I noted that for store brand produce, the prices were very close between Ireland and France for standard supermarkets (Dunnes Stores, Tesco, etc against Auchan, Carreforre), but for branded goods the differences showed. I’m pretty certain the difference in innocent fruit smoothy was almost two euro.

I guess none of that will matter too much to me as I will be shopping at Aldi/Lidl to minimise costs as much as possible.

Anyway, enough ranting from me, thanks for the great site and keep up the good work.

Makes for some interesting reading, doesn’t it. We’re being told that we now have competitive electricity and mobile phone markets, yet we’re not seeing the type of offers and discounts that you could get in either the UK or France.

Tesco price cuts – is it all good?

Diarmuid MacShane

May, 2009

Diarmuid MacShane

Tesco Price Cuts

We’ll all have been delighted to hear this week that Tesco have dropped their prices in stores close to the border. In 11 of these stores, prices will have dropped by 22% on average – permanently according to Tesco themselves.

It’s just a pity that Tesco haven’t done the same across all their Irish stores.

But then again, most of the Irish Tesco stores weren’t losing business to Asda and Sainsburys in Newry and other Northern Irish towns.

So, when you hear Tesco telling us that they’re dropping their prices in the interests of the Irish consumer, you should really know that it’s because those 11 stores were losing huge amounts of business – and as I’ve always said should happen, when business start losing money, they’ll either drop their prices to attract customers back, or else they’ll close down.

Many stores have closed down recently, so it’s good to see Tesco trying something else.

My only concern now is that we’re unlikely to see these price cuts implemented across the country – unless we consumers use our buying power to let them know we’re not happy with the prices their charging everywhere, and not just close to the border.

Price Cuts from SuperValue. Big deal?

We received this e-mail from a ValueIreland.com reader about the “special offers” currently being promoted in store by SuperValu:

I think this is a shocking ploy by Super Valu to fool parents into buying babyfood products from them. The biggest discount they offer in their display is 10 cent on €4.39 – about 2%

The smalllest discount is 2 cent on €0.811. The mean, devious, rotten shower, fumbling in the greasy till and adding the half cent to the cent…
Check it all out here: http://choosepurple.com/supervalu/
Just goes to show you – just because someone tells us that there’s a special offer, or that something is on sale, doesn’t always mean  that we’re getting something cheaper or that we’re getting value for money.
Check the small print if you’re not familiar with the prices to make sure that you’re actually getting a bargain.

Silly Surveys Skirt Real Issues

Irish News of the World

February 15th, 2009

Diarmuid MacShane

Silly Surveys Skirt Real Issues

I see the National Consumer Agency are still carrying out farcical surveys. This month they told us about price differences between the big supermarkets and completed missed the real story – that everyone’s still RAISING prices.

From December 2007, until last month, Tesco, Dunnes Stores and SuperQuinn all jacked up their prices – Tesco by 4.9%, Dunnes by 3.5%, SuperQuinn by 2.8%.

At a time when demand and prices are generally falling in Ireland, our supermarkets are INCREASING their prices by nearly 5%.

All consumers really care about is the fact that grocery prices are going up everywhere – not the relative differences between each.

The truth is, a couple of grocery price sureys by the NCA every year aren’t having any impact on that rising trend. Get your act together.

Latest National Consumer Agency Grocery Survey – the real story

In the light of much criticism for the pointless nature of carrying out grocery pricing surveys, the National Consumer Agency still proceeds with these farcical surveys.

This months one, as referred to by Conor Pope on Wednesday evening, has not a whole lot new to tell us. The headline points from the NCA press release tells us the following points:

* Price difference between multiples widens on basket of branded goods
* Gap between discounters and multiples narrows on own brand goods
* Aldi and Lidl price difference shrinking

Hidden down at the bottom of the press release is the detail of what the headline should be – Grocery Prices Increase across all main grocery stores:

Examining the period from December 2007 to January 2009, aggregate prices in separate baskets for Tesco, Dunnes and Superquinn all recorded an increase. Tesco recorded the largest increase (4.9%), Superquinn (2.8%) the smallest increase. Dunnes recorded an increase of 3.5%.

In a time when demand and prices are generally falling in Ireland, our supermarkets are upping their prices by up to nearly 5%. And the previous darlings of Ann Fitzgerald – Aldi and Lidl – are even at it when it comes to own brand products:

Over the period December 2007 to January 2009, separate baskets for Aldi, Lidl, Dunnes and Tesco all became more expensive. Tesco’s basket recorded the largest increase at 9.3%, Dunnes the smallest increase at 4.1%. Aldi recorded an increase of 4.2% and Lidl an increase of 4.7%.

Who cares, really, about the relative differences between supermarket pricing – all that consumers will really care about is the fact that grocery prices are universally increasing. And a couple of grocery price surveys by the NCA every year isn’t having any impact on that rising trend.

Can we expect Tesco special offers in Ireland shortly?

Sky News Online yesterday reported that “Tesco is launching a £100m price cutting campaign as the supermarket pricing war hots up”. According to the story:

The store giant also said it was launching an advertising campaign comparing the cost of customers’ baskets of shopping against the prices of its competitors. The move comes after Asda announced a wave of discounts on thousands of items. And now Tesco says the prices of a range of staple goods will be cut this month.

The whole grocery pricing issue here in Ireland seems to have died a death – or has everyone just shut up and gone to Newry.

It’s September since the last National Consumer Agency grocery survey, which told us nothing since the previous survey in February. So I suppose that means we’re due another survey from them to tell us that, AGAIN, Dunnes Stores, Superquinn and Tesco are all priced within 7c of each other on a basket of goods, and that Aldi and Lidl are cheaper, and Centra and Supervalue are more expensive.

Given that inflation has dropped recently, overall prices may have dropped since the last survey, but will we see any change in the supermarket faux-competitive status quo?

Latest National Consumer Agency Grocery Survey

I’ve nothing really to say on this latest survey – there was nothing new in February after the last survey, and nothing new this time around either. All we’re really seeing now is the NCA continuing to drive the grocery prices bandwagon – doing pricing surveys is a lot easier than confronting other organisations about their misleading of Irish consumers.
What I would like to know though, about the most recent survey, is why it was actually done at all on the particular day in question? Dunnes Stores had a 10% off weekend offer running on the day in question – surely something like that made the survey a little pointless by distorting the findings?
It’d be funny if Dunnes Stores knew that the survey was happening that weekend – there’s an interesting comparison between their 10% off weekend on the day of the survey and their appearance at the top of the comparisons between it, Tesco, Superquinn, SuperValu, Spar and Centra.

National Consumer Agency Surveys – tell us something we don’t know

Right! Let’s get one thing out of the way here. I don’t think we needed the fuckers* to tell us last week that things were cheaper in Northern Ireland relatively speaking than they are down here. We’ve been travelling north for our shopping in our droves. We’ve been stocking up on our Christmas treats and booze, and our all year round weekly shopping in Newry, and Derry, and Enniskillen and all points just over the border for years. Did we really need our National Consumer Agency to spend our money on a survey to tell us what we already knew?

I had this composed immediately after the initial press release and newspaper coverage, but I decided to hold fire just in case something different happened after this recent survey compared to the non-events that followed the other press releases telling us the blatantly bloody obvious from the National Consumer Agency.

Well, there were a couple of days of hoo-haa, people shouted, there was gnashing of teeth, and general disquiet. And then, nothing. Nothing changed. No one did anything. Everything stayed the same. I’d have to agree with An Fear Bolg who commented on Pricewatch earlier today – “the NCA seems to be on a crazed campaign that may yield little or no results.”

So, we didn’t really need the National Consumer Agency to travel to Newry or Enniskillen or Banbridge to buy baskets of 42 items and compare their prices to the same 42 items bought in Rathfarnham, Blanchardstown and Finglas. This is the same useless regulator who has 70,000 calls to their complaints line in 2007, yet only made 7 prosecutions during that year.

The full details of this pointless research is available here if you want to read more.

There is some useful background information on the application of VAT and Excise rates both here and in Northern Ireland. There is also some interesting information on the differences in rates applied to different products covered in the survey. However, it should also be noted that the price comparisons were made after the exclusion of the impact of VAT and Excise rates.

I just have a few of observations:

  • On the same day as the fuckers* released their research results, it was revealed by the CSO that an average basket of goods costs 5% more in Dublin than it does in the rest of the country. All of the Northern based supermarkets chosen for this current research can easily be described as “country based” – Newry, Enniskillen and Banbridge. Yet all the supermarkets visited down here were Dublin based. I guess it’s reasonable to assume that a similar city (Belfast) vs country divide is just as applicable up there as it is down here. So, let’s assume we add 5% to the northern prices so that we’re comparing like (city = Belfast) with like (city = Dublin) – the “headline” figures from the National Consumer Agency now drop by 5%.
  • Now, let’s look at the price of wages down here compared to Northern Ireland. There’s no mention of this comparison of this in the National Consumer Agency report. Lets assume that the majority of employees in these stores on a fulltime basis are aged 22 and over. The minimum hourly wage in Ireland is, as of July 2007, €8.65 per hour. The equivalent national minimum wage in Northern Ireland is £5.52 per hour. That’s a Euro equivalent of €6.99. Therefore the cost of labour in Ireland is 24% more expensive than it is in Northern Ireland. I guess that’d be a good reason for things to be more expensive down here than up there.
  • What about the price of property – to either buy or rent? Do you think the cost of having a retail premises in Finglas, Blanchardstown or Rathfarnham is equivalent to having one in Banbridge, Enniskillen or Newry? If we look at house prices, which everyone is familiar with – a 4 bed, 2 bath detached house with garage in Newry would cost you upwards on €650k while a similar type house in Rathfarnham would cost you double that. A recent CBRE survey on the cost of renting office property showed that Belfast had a rate of €304 per sq metre, while Dublin had a rate of over twice that amount at $860 per sq metre. And on top of that, our comparison shops up north are based in areas there are probably even cheaper to rent – and all in a market where rental rates are falling in the north, while they’re pretty stable down here, over the past 12 months. Again, a legitimate reason for prices to be more expensive down here.
However, we also know that Irish shoppers are more strongly tied to branded items than many of our European neighbours, and as such, we will naturally pay a premium for wanting these branded items. But that’s our choice – we’re not forced to buy these items, but we like them and we chose to.

I’ve written many times before about this whole euro sterling pricing differential, and each time my message is the same – no matter what retailers or regulators or governments are telling us, the one main factor that will in the long term influence the prices is the shopping behaviour we ourselves follow.

Irish based retailers will claim that the cost of doing business in Ireland is what causes the price differential we all know and see. While not trying to become an advocate for these businesses, I think that above 3 examples show how this can be somewhat justified.

Shouldn’t this type of information also have formed the basis of the research these fuckers* are carrying out in order to give us the full picture of what’s going on and the reasons behind the price differentials.

Unfortunately, we already know that all this is going to yield no results after the comments of John Shine, the NCA director of commercial practices “admitted there is little the organisation can do to help consumers get better value.” Well, apart from wasting time their time doing half arsed, incomplete and pointless research for crowd and press pleasing press releases.

NCA Grocery Price Survey – Nothing New

The NCA have launched their new grocery price survey today – their press release is here. The headline of the release is as follows:

The National Consumer Agency (NCA) has published the findings of its survey comparing grocery prices between Ireland’s multiples, symbol groups, discounters and independents shops. Among its main findings, the survey found:

  • Only 35 cent difference between Tesco and Dunnes Stores for basket of 61 branded goods
  • Supervalu providing competition to multiples
  • Real competition between Aldi and Lidl, providing an alternative in value to multiples and Supervalu for own brand products
  • Independent butchers, fruit and vegetable shops can provide real value
Sound familiar? It’s exactly the same as they announced in July 2007 – only this time enhanced by the research done by Value Ireland when we included Lidl and Aldi in the mix.

So, 6 months later, they’re coming out telling us nothing new whatsoever. You can give me their budget of whatever number of million euro per year, and I’ll tell you nothing new either – damn it, I’ll take half their budget and I’ll tell you nothing new every month.

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