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Mercadona, the leading supermarket chain in Spain, has taken a step to alleviate the impact of inflation on consumers by lowering the sale prices of 500 products until the end of the year. The company assures, in a statement released this Wednesday, that it has made the decision after verifying that costs are already falling, albeit “slowly”, after more than a year of strong upward pressure. The company thus breaks with the strategy of not making offers. Company sources explain that they are perceiving that some products such as milk, flour or some vegetables are becoming cheaper at source and that allows them to transfer that reduction as soon as possible to a wide range of products.
The measure, which starts this month, represents an average annual saving in the shopping cart of about 150 euros, according to the company chaired by Juan Roig. The total savings for customers will be 200 million euros between now and the end of the year. The impact of the company’s margins is -0.6 points, which is added to the reduction made by the company of -1.1 points since 2020 to “minimize the significant increase in cost prices at origin and the industry”. Company sources assure that they will advance the price drop of some processed products to which the market has not yet affected the reduction in raw materials.
The initiative does not consist in capping prices, but rather adjusting them to transfer the change in trend in the moderation of costs as soon as possible. In this way, customers “can save in advance of this reduction.” The initiative “is carried out without affecting the quality of the products and guaranteeing the sustainability of the entire food chain (suppliers, productive sector, company and workers),” according to the statement.
What Mercadona products are cheap
The price reduction of the 500 Mercadona products (many of which will be duly identified in the store) will be applied to numerous foods for daily consumption, such as canned products such as tuna, dairy products such as some cheeses and yoghurts, fruits dry goods, oils, household cleaning and maintenance, pet food, pastries, wine cellars and perfumes; among others. “In the case of fresh products, the company will take advantage of market opportunities to lower the price,” says the statement, which cites zucchini, fish and turkey breast as examples.
Juan Roig, President and main shareholder of Mercadona, assured in March that supermarkets are not taking advantage of the rise in food prices in the face of criticism launched in recent weeks by some members of the Government. But he admitted that prices have risen a lot: “Yes, they are right, we have raised prices a lot. If we had not gone up, the disaster in the production chain would have been impressive,” he said at the press conference to present the results of the company, which increased its net profit by 5.5% in 2022 in a context marked by inflation. .
The measure announced this Wednesday comes after, a few weeks ago, the Minister of Agriculture, Luis Planas, met with the entire food chain, from farmers to supermarkets, to ask them to transfer as soon as possible the gradual reduction in costs that began to detect Mercadona thus joins the race to try to make the shopping basket cheaper. Eroski recently announced the launch of a shopping basket with 600 basic products for less than 2 euros. Meanwhile, the Dia group announced on Tuesday a 15% increase in its investment in promotions, up to 150 million euros, “to support family savings.”
The CPI for food stood at 16.6% year-on-year in February, which translated into an annual extra cost of 924 euros in the shopping basket, according to the latest data from the OCU. The biggest year-on-year increases affect sugar (52.1%), butter (38.2%), whole milk (33.4%), sunflower oil (32.1%), olive oil (30 5%), bakery products (28.2%), flour (28.1%), eggs (27.2%), yogurt (26.7%), cheese (20.5%), %) or rice (19.6%).
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