Supermarkets have got us enraptured by their price hikes

3 June 2011

trolley Research has shown that you lot (British shoppers) are pretty content with your supermarkets, even though food prices are rising steeply. After all, prices are going up aren’t they? That’s what’s happening everywhere, and the likes of Tesco and Sainsbury’s are just passing on their own rising costs, right? Not quite.

A boffin claims that UK supermarkets are making a pretty penny out of the increase in food prices, passing on their own rising costs and then some, duping us poor saps into parting with even more cash than we actually could be.

That boffin is Jim Leaviss, head of retail fixed interest at M&G, the fund management arm of the Prudential, and he reckons we’ve all got Stockholm Syndrome, the phenomenon where kidnap victims fall in love with their captors. Yes, the supermarkets have got us all trussed up in a basement and they’re only letting us go to the toilet twice a day.

Food price inflation in the UK is currently 4.7 percent, against 2 per cent in the rest of the eurozone, but research suggests that we’re all happy with the increases and are generally happy with the evil supermarkets.

Jim says: “When food price inflation started to moderate post the last shock in 2008, European food retailers cut prices. In the UK the supermarkets realised that they had pricing power and kept raising them; this resulted in the strong relative profitability that they enjoyed.”

Still love your supermarket of choice now? Not so sure? Perhaps you’ll start fighting back, rearranging the shelves and putting items down really far away from where they should be next time you’re in...

TOPICS:   Supermarket   High Street News

15 comments

  • Dick
    Our percentage price increases may be higher than the average eurozone, but what about actual costs? I was in Italy and France a couple of weeks ago (on separate occasions, not at the same time using my soon to be patented dual location quantum discombobulator) and the prices for even some basics were fucking high compared to Tescos.
  • Speedy
    The boat left on this a fair while back. Supermarkets understand that most people shop on price alone, therefore you can reduce the quality and sell absolute shite for maximum profits. Once you've established this you then reduce the quantity/weight sold gradually to further add to profits. The classic example of this is meat. My award winning posh organic London butcher charges £9.99 a kg for top quality organic streaky bacon (it has the rind on to). Supermarkets standard/water added shrink bacon labelled finest/super quality is £11.99 How can a vastly inferior product cost £2 a kg more? You try and explain the concept that they are paying top dollar in a supermarket for absolute shit and for a few pence more could have top quality at a butcher and they look at you like you're abusing their kids.
  • Boris
    @speedy More bacon based economics! Has the world gone mad?
  • Jamie
    I don't necessarily think it is a love for supermarkets. It is solely because they offer the cheapest food. What is the alternative? It is all well and good saying protest and stop shopping with them, no one in their right mind will shop elsewhere if it is more expensive.
  • Sawyer
    The research is clearly wrong. British shoppers are never content with anything.
  • dvdj
    Exactly, it's still a damn site cheaper than fucking convience stores such as Co-op. Now Co-op, there's a company I'd love to fucking bomb. Ethical company my arse, twats.
  • Jonny S.
    Thats why I shop at Aldi as well as Tesco - good prices and a lot of their stuff is decent.
  • Dick
    I find the Co-op are very ethical. They have a policy of recruiting people from a range of backgrounds and clearly do not discriminate against minority groups. At least, that is the only way I can account for the number of fucking in-bred mongs that work at our local one.
  • The B.
    That's why I buy my meat at Smithfields and then chuck it in the freezer, it saves an absolute fortunes bypassing the supermarket/butcher. 5kg of chicken breasts for £17, 3kg of Rib eye for £30, it saves you a fortune. The only problem is that you can't bog off an buy in bulk from somewhere like New Covent Garden market because you can't freeze veg.
  • Mark C.
    Would love to buy my bacon at an award-winning independent butcher, but round my way, Sainsbury, Morrisons and Tesco have put them all out of business. Which I suspect says more about consumers than it does about the supermarkets.
  • klingelton
    my wife still enjoys a healthy dose of pork, despite being a veggie.
  • Bazinga
    Can the story be updated with more bacon-based calculations?
  • Boris
    As predicted my bacon based investmants have gone south. Thanks a lot BitterWallet! Now I'll have to rely on my drug dealing and running London wages to get by on. I'm working on a new environmentally good food suff I'm willing to sell cheap to anybody. It's made on some abandoned land I've borrowed from the Authority. It tastes a lot like bacon too. I call it Soil-lent Green. £4:50 per kilo. Non-nom. You can get it in white and .. err.. some "smoked" stuff too.
  • Craig
    Yes, I'm really pleased with the ethics of the Co-Op too. I'm particularly pleased how they took the "valuables away from home" cover out of my house insurance, so they would come top on a comparison site, and bury that fact in the small print, so that the only time you knew was when your £750 bicycle was no longer where you left it & you needed to make a claim. Twats.
  • jcjamiec
    how can they(tesco) justify an increase of 50% on a crate of 12 beers, from £8.00 to £12.29 in one foul swoop. what an absolute rip off. Personally im doing my protesting walking i will never shop in tesco ever again. any company that has that much disregard for its customers does not deserve anybodys custom. arseholes

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