This is the history: Price monitor Stefan Meierhans has encountered new resistance with his investigation into allegedly abusive retail prices for organic food. The investigation had already made headlines before Christmas because the publication planned at the time was prevented: “10vor10” revealed that Migros was behind it and threatened legal action against the price monitor because it defended itself against the charge of market power.
Presumably due to public pressure, the group has meanwhile backtracked and agreed to the publication. However, some passages in the report have been blacked out. It is likely to be profit and margin information that Migros considers a business secret.
This is what the report says: Meierhans has now published his report. With this interim report, however, several open questions were raised, he notes. In order to answer this, he will keep the topic under constant observation and follow it up. In the course of his analysis, the retailer selected “despite the noticeable resistance of certain companies” also submitted a proposal for a voluntary commitment regarding the design of the organic margins.
You can read the report here
Retailers refuse: Since consumers would accept an organic markup of between 10 and 30 percent on average, he suggested that absolutely no higher margins should be charged as long as the organic markup percentage is more than 20 percent. Higher net margins for organic products would therefore only be permissible as long as they were no more than 20 percent more expensive than their corresponding conventional product. Regrettably, the invited companies are not willing to make this commitment, which involves price reductions.
This is what consumer protection says: The prices and margins in the organic trade in Switzerland are not only too high, but also extremely non-transparent, criticizes consumer protection in a statement. Since the price monitor, unlike the Competition Commission (Weko), cannot impose fines, the Weko must keep a close eye on Migros and Coop. It cannot be that the two major distributors can continue to divide up the market undisturbed and demand excessive prices from consumers.
What the retailers say: Coop and Migros have written to SRF about the report.
Legend:
Keystone/Georgios Kefalas
«The profit margins of the retail trade and thus also of Migros are extremely thin. In view of the fierce competition in the retail trade, we could not afford exaggeratedly high margins. Our current profit margin (profit to sales) is 2.3 percent. Other companies of a comparable size outside of the retail sector regularly show profit margins of 10 percent and more.»
Legend:
Keystone/Gaetan Bally
«Never before has the retail market in Switzerland been so competitive due to the market entry of discounters with sales of around CHF 9.3 billion compared to Coop with CHF 11.6 billion. In addition, there is shopping tourism with a turnover of CHF 7 billion. This tough competition does not allow the realization of excessive prices and margins. The study also refers to gross margins, which are not meaningful because they neglect essential cost items. The bottom line is that Coop does not earn more from organic products than from conventional products.”
You can see more on the subject tonight at 7:30 p.m. in the “Tagesschau” on SRF 1.