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Multinational Companies Sell Their Goods in Greece 90% Higher Than in Other EU Countries

There has been lot of talk lately about the lowered minimum wages in Greece, especially when compared to countries like Bulgaria or Estonia. KTG has often said, that it is not fair to compare just the wages. One has also to compare the cost of living. With minimum wages now below €500, one gets the impression we have Balkan wages but Northern European prices.

 Everyone who has lived abroad and here, gets formally stunned when visiting a Greek super market. Products of multinational companies are sold here in double prices. A Greek consumer pays at least 2.50 euros more for a shampoo of the X-brand, 2 euros more for a tube of toothpaste. Recently, I was shocked myself to have to pay 8.90 euro for a brand-name hair spray. Not the cheapest, not the most expensive one. Average quality and size for a … strong hold. Detergents are another point of high prices. I’ve seen brand-name powder for washing machine been sold at 29 euro (70 measures). Not to mention the 500-ml bottles of green jelly to wash dishes: 1.45 euro until last week. Now its price is up to €1.52. And By the way: this same bottle size of the same company was sold for 1.02 euro during a promotion week.

A recent survey conducted by the Greek Ministry for Development showed that multi international companies sell their goods in Greece at a very large profit. Toiletries are sold at 96.5% higher than other EU countries, detergents at 44.2%, soft drinks at 51.3% and cereals at 46.96%. The survey was conducted in super markets of Greece, Germany, Bulgaria, Spain, Italy and the Untied Kingdom.

According to daily ETHNOS, the Greek subsidiaries of the multinational companies with various tricks they seem to present virtual damages and ‘iflated’ prices. In such way they avoid taxation in Greece and they transfer their profits in the parent companies. 

Additional factors to the high prices for the consumers are the high Value Added Tax at 23% and the high transportation costs due to the closed profession of truck owners.

Another issue that came up with the Potato Movement are the high prices for fresh agricultural products. According to the Ministry, carrots, for example, are sold by the farmers to the large retailers at 0.33 euro per kilo, but they reach consumers at the open markets or grocer’s at the price of one euro. The Ministry finds difference of  even 169% between the field price and the end price. However, ministry officials estimate that vegetable and fruits price went down recently due to income decreases that have influenced consumers’ behaviour.

However, here we have to mention the influence of the Potato Movement, when farmers from Nevrokopi decided to undercut the large retailers and sell their potatoes directly to consumers. The whole distribution is done by volunteers and now also in cooperation with municipalities. An action that has forced some local super markets to drop potatoes prices.

A farmer from Nevrokopi told private Mega TV oon Monday, that retailers buy their potatoes for 0.15 euro per kilo, while the production cost is 0.25 euro per kilo. He said that they sell now at 0.25 euro. The farmer also stressed that since the movement started, large retailers are threaten them, that they won’t buy form them anymore.

The winner from this action is the consumer. The potato movement is growing like a wild fire, and consumers can buy ten or twenty kilo packages for an average price of 0.33 euro.

And yet. What are the labyrinth ways an agricultural product has to go through to reach the consumer? Is all profit for large retailers? I think a report on the issue could …enlighten us 🙂

PS The super market at my neighborhood was selling last Saturday potatoes imported from Cyprus for 0.95 euro/kilo in a 2,5-kilo net. The alternative were Greek potatoes from I-don’t-remember-where at 0.30 euro. However they looked old and were full of holes….

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54 comments

  1. So both the domestic and the imported stuff is expensive in Greece. And the fault is obviously of the foreign companies and not at all the Greek middlemen and Greek retail?

  2. keeptalkinggreece

    we didn’t say that as their subsidiaries are Greeks 🙂

  3. It’s obviously not clear yet whose fault is that, Sam. Other issues may be productivity (more employees at Greek supermarkets, maybe?) and costs like electricity or property taxes. But it sure needs to be chacked if the competition between the retailers is actually working. That the new direct sales by the farmers led to decreasing prices at the stores is suspicious. Why didn’t the competition between the retailers have the same effect? There may be a hidden cartell working behind the scenes to keep the price level high, this isn’t totally unheard of in other countries, neither. There has to be an investigation into this.

  4. Not just the products of multi-national companies.My favourite Greek brand of tomato purée is a good bit cheaper in Brixton compared to Athens or Nafplion.

  5. keeptalkinggreece

    price cartel? I thin I had recently posted here or just read about Greece fined some multinationals on pric cartels. Must check again.

  6. keeptalkinggreece

    yes, I remember buying Greek products in Germany too cheaper than in Greece. Also other KTG said so in our FB page. I assume here they do not need to be competitive, but abroad there is big coompetition by Turkish or Italian similar products. Therefore….

  7. The Israelis have a very similar experience. Haaretz recently reported that a popular candy manufacturer in Israel sold its sweets way cheaper in the US than on the domestic market. This gained a lot of media attention, customers were up in arms, and the sales of that company tanlked. Rightly so!

    In Germany, it’s very well known that our cars are sold at lower prices in some neighboring countries (and I guess the US prices are a lot cheaper, too). Some folks here save thousands of Euros with “gray” (no relationship! :D) imports. The manufacturers try to prevent this, but EU law is on the side of the customers.

  8. Supermarkets definately need to be investigated on prices. I see it every time I shop and in every Supermarket. Shop around? Like the majority of people I certainly do….I’m not going to pay 1.49 for a litre of milk when I can get it elsewhere for 84cents. If a large chain supermarket can find and sell a product at a much lesser price then so can the other large chain supermarkets, particularly with the austerity measures as they are. And when the summer season starts up go the prices even more! More consumer protection and monitoring of prices is needed here.

  9. keeptalkinggreece

    definitely. but who could do such monitoring? unfortunetely there are not strong consumers’ NGOs and protections groups here like in Germany, for example.

  10. DON’T BUY IT!

  11. Yes there is a weakness here in consumer protection and price monitoring, who could or should make it happen? Government? Consumers? The products I buy, I need and use and because of the huge difference in prices(especially day to day items)I’m happy to shop around for. We can’t do without everything, just try and get value for money and a better price for what we do buy. I see Supermarket sales slumped to an all time low in 2011 and now people are turning to buying Supermarkets own brands, nothing wrong with that, if it puts a meal on the table that’s all that matters, I daresay a lot of products are processed in the same factory just different packaging…..that’s the way it is.

  12. Ironically, that is the joke among us diaspora folks. In the USA, most (not all mind you) products are 1/2 price and double quality and quantity, but of course the really cheap stuff from China is not worth the money.

    Gray may be right because since the effectiveness of many Greek supermarket personnel is below standards to western countries, they need more of them. I always get frustrated when the local supermarket’s self-checkout line seems to be broken all the time. I think it’s done by the employees to keep progress from advancing and their jobs safe. I may be wrong.

  13. On the contrast of this also, is the ineffective processes many Greek companies use to compete with more superior marketing techniqes abroad. This article from bloomberg is a great example of how although Greek wines are quite good, they just don’t make it to the market in the USA because of “HELLO” ineffective business processes here in Athens.

    If we could get Folie-Folie or Fage to run Greek wines, maybe there’s hope, but shame that no one has figured out how to sell Greece’s products abroad and made it into a science.

    http://www.businessweek.com/articles/2012-03-06/greek-wines-how-do-you-sell-a-mouthful-like-agiorgitiko

  14. keeptalkinggreece

    independent control & monitoring bodies are needed, which I think it is quite difficult here. well…. I wouldn’t say ‘a lot’ but I wouldn’t exclude this possibility either. ( At least in pet food, it was revealed some years ago through a Chinese melamine scandal (2006 ?) Of course, brand name products can guarantee for a certain quality and are more expensive than private labels products, which have an average quality, I guess.

  15. Well, I may be wrong, too. And I really didn’t want to make it sound as if the explanation for the suspiciously high prices is that Greeks are lazy. Really not. High fluctuation among the staff, low qualification, inefficient organisation and unreliable technology may drive labor costs up for the supermarkets, but that can still only be responsible for part of the difference. As I said, this issue urgently needs a detailed investigation.

  16. Good find, thx, Ag. kap! Afaik very much the same is true for olive oil. Much of that high quality product is sold comparatively cheap to Italian brands who make a good profit with that. What’s necessary is theat Greek producers unite, for instance in cooperatives, do their own marketing and negotiating with the big retailers and food manufacturer. Only with more economic leverage they will be able to increase their own share of the profits!

  17. As far as I remember, European producers of washing detergents have been fined by the EU last year or so because they had run such a price cartell for years.

  18. A very interesting view, and very true. I am shocked at the expense of baby products in this country in comparison to the UK and Ireland and other European countries. A well known brand of nappies here costs nearly 20 euro for a large packet while the same product sells for half the price in the UK and Ireland. I actually contacted the multi-national who manufactures this product some months ago as I was curious as to why there was such a huge difference in the price to the consumer and received a very vague reply blaming import taxes and transport cost for the huge difference in price. Strange really seeing as I myself can import the product for use in my own home from other European countries without paying any additional taxes or huge shipping costs. The same goes for baby formula for 0-6 month olds, a 900g box costs between 25 euro and 29 euro in Greece whereas the same product costs less than 10 euro in the UK and Ireland. Who is winning here? It certainly isn’t the consumer.

  19. keeptalkinggreece

    Pamela, they maybe transport each nappies package with a private taxi. It’s true that VAT tax and transport costs (for transp inside Greece) are high, but there is no excuse for doubling the prices. No company would admit price cartel.

  20. keeptalkinggreece

    I remember that too.

  21. KTG, that was a great answer on the Private Taxi for each Nappy package. But, couldn’t they at least use the metro or bus for each package and it would be cheaper?

  22. keeptalkinggreece

    impossible. overcrowded metro or buses could damage the package.

  23. Me too Pamela, I use the 2 main obvious online sites we all know, I have had items shipped here to my door for a fraction of the costs including 2 items quoted 380 euros here – I found the same items in UK for 169 pounds, they were transported from Birmingham to Heathrow, flown to Athens then flown again onwards to me, couriered to my door for 20 Pounds. I don’t know how they done it – but they did. It does make you wonder!

  24. Interesting topic ktg and you need me to go shopping with you see if we can’t find you a cheaper hairspray, I’m sure we can lol. Enjoy the rest of your day.

  25. keeptalkinggreece

    lol thanks a lot. Hairspray is a girl’s best friend (next to diamonds)/

  26. Just an idea: Carriers could deliver those packages by foot! Lots of fuel saved, and imagine the huge job creation effect. Greece invented the marathon, after all, and now it could put its vast experience to good use!

  27. Rima we do exactly the same, we don’t buy anything in Greece at the ridiculously inflated prices that there are here when we can source the same products from elsewhere in Europe for a fraction of the price. It’s a pity really because if we kept our money in Greece we would be helping the economy and maybe keeping a few people from losing their jobs but instead I’m afraid to say we seem to be supporting the economy in the UK for the most part and I know we’re not alone. Pricing such as it is in Greece with the open market of Europe on our doorstep seems like false economy on the part of the multinationals. I won’t even get started on the prices of clothes and shoes for children here….

  28. iaourti iaourtaki

    Take a cargo bike/ bike messenger

  29. not sure this is on topic, but your recent comments only list about 5 of them. Sometimes I’d like to see who else posted a comment but they disappear. Isn’t there something you can do to make it go beyond 5 and make it like 50? It would be so conveninet and I’m sure many people would agree on your blog. Ask your readers and see if I’m right? It would make it much more easy to follow my favorite posters like Antonis and Gray etc…

  30. keeptalkinggreece

    you mean the list on Home Page on the right space?

  31. yep, the “RECENT COMMENTS” in red color on right side.. on home page.

  32. Also, this for GRAY:

    Gray, remember I was talking about how much I enjoy Folli-Follie, they are what’s right about Greece and if they could run the government, it would be a better Greece I think.

    Check out what they are doing to help Greece today, per Bloomberg:

    http://www.bloomberg.com/news/2012-03-08/folli-follie-plans-campaign-to-attract-tourists-to-greece.html

    Folli-Follie is like an American company with a Greek cover. I think they are very productive and superb!

  33. keeptalkinggreece

    I’ll check it ou.t BTW: is this the way people follow the comments? I have been wondering all the time, how people know and commented on comments lol

  34. Well, there are two ways I use to follow comments. First the recent comments (on right side in red) as we said. But, this is problematic because it only lists 5 and then if there are a lot of comments, then you never see them there.

    The second one is to go story by story and see if anyone commented, but this takes too much time.

    So, the best way is to have 50 recent comments available which will allow a reader to view your site comfortably once a day and see who commmented where and respond if desired.

  35. keeptalkinggreece

    I changed it into 10 comments. There were no more available 🙁

  36. My thoughts exactly. It is a shame but until they get it together here with prices….. I know so many people that have items shipped from abroad.

  37. I remember there has been a “visit Greece now!” campaign at the Greek-American News, too. Afaics Greek expats from all around the world, most prominently from the US, Australia and the UK, are really trying their very best to help their homecountry. Sadly, much too often their advice is rejected by Greek folks who are against all changes. Why are folks so afraid of modernisation and improvements?

  38. Good idea, ktg! Still, I can only see 5 comments showing in the orange-red box?

  39. Hmm, just a guess, ktg: Maybe you have to increase the box size, too, and not only the maximum number of comments that can show up there?

  40. It still shows only 5 most recent comments. Maybe you are missing a further configuration step in order for the change to take effect?

    Also, would it be handy to have the “recent comments” field appear e.g. right below the “recent posts” field? I’m assuming that would be possible.

  41. keeptalkinggreece

    me too LOL – I must ask the tech company to do it..

  42. keeptalkinggreece

    that would be far too long to be up there, I think (?)

  43. “far too long” – maybe(?) I just tend to think that those two fields would go quite nicely ‘hand in hand’, so to speak. Perhaps give it a try?

  44. keeptalkinggreece

    I will contatc the tech co. and see what we can do. With 50 comments it will ‘break’ the right space

  45. any word on the number of comments being changed? maybe 20 would work?

    Also to GRAY: To answer your question, unfortuantely, there is quite a bit of jealousy from local Greeks toward Greeks of the diaspora especially Greek-Americans. Even some of their funniest Greek commercials make fun of Greek-Americans, but I equate it to sports, how when you are the best team, always other teams tease you are jealous etc. As one of my Greek-American friends say, they call us Amerikanakia until they actually go to America and see how an infrastructure comes together…..

  46. keeptalkinggreece

    “Greek commercials make fun of Greek-Americans”. Where are these commercials?
    I;ll try to fix the comments-issue today.

  47. Is that study available online somewhere? Was it translated into English?

  48. keeptalkinggreece

    you must check the link, only in Greek

  49. The Greek commercials that make fun of Greek-Americans:

    Two come to mind:

    The most famous one: OH Mamy.. The Greek American with loud clothing and big fancy car comes home to the village yelling “Oh Mamy” “Oh Mamy” and his mother thinks he’s running to hug her, but he’s running to get some of the “OH MAMY” candy….

    Number two: Dirend.. There’s a Greek American in a business suit that says “Stin Amerikee kanoume etsi” in a funny Greek-American voice, and the narrator says “Steen Ellada, exoume Dirend”….

    Those are the first two that come to mind.

  50. keeptalkinggreece

    *sigh* I remember my uncles coming from America in their fancy multi-coloured and bright in design clothes ( when Greeks were dressed in modest colours) bringing us Ananas powder drink, Nescafe and Corn flakes. I have’nt see Dirend commercial, but uncle Yiannis used to say speaking Greek with his American rolling ascent: “Sto Amm’rrrica kan’me eeetSi. or something like that. ( We kids found it was funny, and we used to imitate him saying stupid things , forming no real words with lots of rolling RRRRsss and LLLsss.). In the last years, several Greek commercials use people speaking village-Greek ascent. Me and my friends grwoing in Athens got almost offended thinking ‘is the common Greek a … village Greek?’ And we distanced ourselves from these commercials 🙂

  51. Be careful KTG, because those who cannot laugh at themselves are doomed to have others do the job for them. Being self-effacing is actually a trait most Greeks don’t have, they take themselves way too seriously. Not all mind you, but many…. Just laugh at yourself, and you’ll be much happier in life. You don’t think Americans lose any sleep if Greeks make fun of them do you? 🙂

  52. keeptalkinggreece

    I would wonder if Americans would lose their sleep over some Greek commercials. Yet, these are some things where I pretend to be offended out of …national pride lol