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COST OF LIVING

Pasta up by 13 percent: How food and energy prices in Switzerland are rising

Even though the inflation rate is lower in Switzerland than in the eurozone, costs of some common consumer goods and commodities have risen.

Published: 16 September 2022 17:32 CEST
Which Austrian chain is best to shop in?
Image by Alexa from Pixabay

Unlike neighbours France, Germany, Italy, and Austria, where the inflation rate hovers from over 6 to over 9 percent, Switzerland is doing much better on that score: its rate is currently about 3.5 percent.

What does this mean in terms of cost of living?

According to recent data from the Federal Statistical Office (OFS), which looks at which prices have increased the most, energy in general has registered the highest spike of all the consumer goods: 28 percent.

Within that category, fuel oil went up a whooping 86 percent, gas increased by 58 percent, petrol by 28 percent, and wood by 26 percent.

READ MORE: Swiss government confirms ‘sharp increase’ in electricity prices

As far as food is concerned, only four items registered a four-digit spike: pasta rose by 13 percent, cooking oil by 11 percent, and butter and coffee by 10 percent each.

Next are fish (9 percent); poultry, milk and yogurt (5 percent); bread and eggs (4 percent); and beef (3 percent).

Among non-foods, the price of toothpaste and other dental hygiene products rose by 12 percent, and clothing and shoes by 4 percent.

There is a bit of good news as well: the price of fresh vegetables dropped by 4.6 percent and that of shoes and clothing by 4 percent, according to FSO.

What’s ahead?

While energy prices will most likely remain high throughout the winter, the cost of other products depends on the evolution of inflationary trends. And there is no consensus on how that will turn out.

Claude Maurer chief economist at Credit Suisse predicted that Switzerland’s inflation rate will drop to 1.5 percent in 2023, and even as global economy  faces inflation-fuelled recession risks, “the situation remains positive for Switzerland”.

Another expert, however, Martin Eichler, chief economist of the economic research institute BAK Economics, said that “the next few months will be difficult” as Europe’s woes are expected to spill over to Switzerland as well.

“In many of Switzerland’s European trading partners, the toxic mix of energy shortages and massive gas and electricity price hikes are already having recessive effects”, Eichler said.

READ MORE: Cost of living: How you can beat Switzerland’s inflation blues?

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SHOPPING

REVEALED : Are ‘discount’ supermarkets in Switzerland really cheaper?

Lidl, Aldi and Denner claim their prices beat those of large Swiss retailers. But is this really the case?

Published: 18 April 2024 11:40 CEST
Updated: 1 May 2024 06:35 CEST
REVEALED : Are ‘discount’ supermarkets in Switzerland really cheaper?

Common consumer goods (except one) are typically more expensive in Switzerland than in neighbour countries — sometimes by much.

This includes food.

READ ALSO: Why Switzerland is the most expensive country in Europe

That is especially the case of largest Swiss chains, Migros and Coop, while Denner, Lidl, and Aldi say their food prices are significantly lower.

To find out whether this claim is actually true, journalists from RTS public broadcaster’s consumer programme went shopping in each of these supermarkets. 

They purchased the same 30 products in each of the five supermarkets on the same day, to ensure that the price comparison is as accurate as possible.

Not what you’d expect

In each of the stores, the investigators purchased only the lowest priced items from the supermarkets’ budget lines.

It turned out that most money was spent at Denner, widely considered to be one of the lowest-priced supermarkets.

The total for the 30 items came to 181.67 francs — more than was spent at the country’s more expensive stores, Migros and Coop, where identical basket of goods cost 170.37 and 167.82 francs, respectively.

(That, in itself, is surprising as well, because Migros typically has lower prices than Coop).

As for the other two supermarkets, these purchases cost 166.59 francs at Aldi and 162.05 at Lidl.

So the difference in price between Migros and Coop versus Aldi and Lidl is minimal. But what is even more surprising is that the cost of groceries at ‘cheap’ Denner is actually highest of the lot, by between 11 and nearly 20 francs.

Migros and Coop performed quite well in the comparison survey because most of the items purchased in those stores came from their budget lines, M-Budget and Prix-Garantie, respectively, both of which were introduced to compete with Aldi and Lidl.

But how important is price? Patrick Krauskopf, a professor of anti-trust law, told RTS: “German, French, English, Spanish and American consumers pay a lot of attention to price. In Switzerland, consumers place more emphasis on quality of service. Price is almost secondary.

“Distributors have realised this and have stopped competing fiercely on price.”

Big versus small

While this particular analysis focused on supermarket chains, another survey, conducted at the end of 2023, looked at prices in small grocery shops. 

Common logic has it that it is cheaper to shop in supermarkets than a local corner store, because big retailers purchase products in large quantities, which means lower prices for consumers.

However, prices in some local shops were found to be “up to 30 percent cheaper than Migros and Coop.” 

The reason is that in order to cut costs, small grocers may buy their products from the most cost-effective suppliers, a tactic which includes importing some items.

Another reason for lower prices is that unlike major supermarkets, which ‘pretty up’ their stores for better presentation of products, these small retailers are ‘no-frill’ shops. This means little money is invested in décor, so there are no extra costs to pass on to consumers.

 READ ALSO: Why it might be cheaper to avoid the big supermarkets in Switzerland
 

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