COST OF LIVING
Sweden’s Finance Minister has called for supermarkets to follow Lidl’s lead after the grocery chain announced that it lower and freeze prices on more than a hundred items for at least two months, starting on Monday.
Published: 23 March 2023 13:51 CET
Will the other Swedish supermarkets follow Lidl’s lead and freeze prices? Photo: Magnus Hjalmarson Neideman/SvD/TT
Prices will be cut on average by 11 percent, the supermarket said.
“We have chosen a large number of popular products which we will give a lower standard price. These measures will cost money, but we are prepared to face that cost and do what it takes to support Swedish households in these times of financial challenges,” Lidl’s Sweden chief Jakob Josefsson said in a press statement.
Household grocery bills are soaring in Sweden, as The Local has previously reported. Prices of food and non-alcoholic beverages last month rose 21 percent year-on-year, the biggest increase since the 1950s, eclipsing even the high-inflation years of the 70s.
“I hope the large food giants will follow [Lidl’s] example,” Sweden’s finance minister, Elisabeth Svantesson, tweeted.
“I think that these three food giants, which represent 90 percent of the market, can put some pressure on their suppliers,” Svantesson said. “Of course they can do that. Lidl is leading the way now.”
Svantesson did not rule out meeting with food producers and suppliers, but she sees focusing on the larger chains as a higher priority as they have the ability to put pressure on other actors further down the line.
In France, supermarket Carrefour decided to lower its prices earlier in March, and Kiwi in Norway has decided to do the same. In Sweden, however, Lidl is the only company to do so. Lidl’s market share in Sweden is between 5 and 6 percent.
Price freezes at other supermarkets unlikely
However, it looks like the other major supermarket companies – Coop, Axfood and Ica – don’t have plans to lower prices any time soon.
Sweden’s Coop supermarket said on Wednesday evening that they won’t be following Lidl’s lead.
“We adjust our prices when we get price adjustments from our suppliers,” Coop’s press secretary Marcus Björling told TT newswire. “We can see multiple items on their way down and expect therefore to see our suppliers dropping prices.”
“Our assessment is that we’re going to see lowered prices in some categories going forward.”
Axfood, which owns the Willys and Hemköp supermarkets, is not planning on any price freezes either, stating instead that they are planning more long-term.
“It’s a much more active price market at the moment, and that’s why we’re so clear that our long-term goal with Willys is to work on offering Sweden’s cheapest bag of groceries – across all products, not just a few individual items,” Axfood’s CEO Klas Balkow told TT on Wednesday night.
Ica’s CEO, Eric Lundberg, told TT that the supermarket were working hard to put pressure on suppliers to lower prices.
“[Lidl’s price drops] show how hard competition is at the moment, all actors are doing what they can to win customers. At Ica, we are working on price changes across the board, further offers for our Stammis customers and campaigns in individual stores.”
He added that “everyone at Ica” is working hard to put pressure on suppliers, through negotiations and through lessening price increases centrally and in stores.”
“We can see signs that price increases will start to slow down on multiple items throughout the spring,” Lundberg said.