why hard-discount brands are more affected than supermarkets

Margaux Fodéré, edited by Gauthier Delomez

Inflation slowed down a little in August, to 5.8% against 6.1% in July. However, among hard-discount brands (Aldi, Lidl, etc.), the increase is more marked than in supermarkets, where prices also remain high. In reality, these stores do not have sufficient leeway to absorb these costs.

On supermarket shelves, prices remain high. And for good reason: while inflation slowed down a little in August, to 5.8% against 6.1% in July, retailers, particularly in hard-discount, are the most affected by the rise in price. This reached 8.66% in August in surfaces such as Aldi or Lidl against 7.70% in hypermarkets. And in the product catalogs, this price increase is clearly visible: it is sometimes necessary to add several tens of cents to certain items.

Less leeway

This surge in prices may seem surprising because these surfaces are supposed to offer products at ultra-competitive prices. But, according to Thomas Graffagnino, retail expert at Sia Partners, they also have less leeway to cope with rising costs. “What you have with discounters is a set of costs that will be at a minimum. This means that when you have inflation on a product, the capacity of this discounter to absorb it in its costs and not to not pass it on to the consumer is diminished”, explains the expert on Europe 1.

It is the same thing on the private label side, where prices increased by 10.67%. “As there is an intermediary between the producer and the distributor brands, we will inevitably have a negotiation which will be less easy between the two”, estimates Thomas Graffagnino. This is why, according to this expert, these signs will have “a capacity to absorb inflation which is a little less”. Finally, it is on the first prices that the increase is the most significant: +13% in August.

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