This is indeed my question as well. I am Czech. We are right next to Germany. Theoretically, this is one huge Common Market. In practice, many mass-produced things are much more expensive in Czechia than in Germany, including food.
I suspect that the language barrier is still real. But then again, German-speaking Austria experiences the same thing.
I wish we had a common European delivery service, like the US has US Post or DHL, with the same cost structure across the entire continent. We don't, a package from Spain to Czechia is much more expensive than within either Spain or Czechia.
A common European delivery service would give foreign e-shops a massive competitive edge. Suddenly, it would be more efficient to buy cheaper things in Slovenia or Bulgaria.
You think villains such as Macron would allow actual competition? They fucked half the continent trucking companies to enrich their own. So much for unity
In Germany? It gets superceded by more ethnic retailers importing cheap produce from their relatively poorer origin countries, and offering actual competitive prices against the likes of Aldi and Lidl.
I've noticed a surge in Germans going to Turkish/Arabic food stores in the last few years.
Common market means that Apple can't charge for iCloud to Sweden more expensively (before tax) than what they charge to Spain, it doesn't mean that goods made in one country of the union can't have way different pricing in another based on shipping, VAT, taxes, labor, supply/demand, or straight up price gouging.
I'm talking about laws and enforcement of laws against anti-competitive practices like price fixing. Either enforcement is wildly different and there's a shitload of money to be made by undercutting the Austrian grocery cartel or the price fixing theory is just a socialist talking point.
but in order to do that for groceries you have to open shops in austria which makes it much more difficult compared to products that can be sold online.
How hard is it to sell food out of a flower shop? Out of a candy store? A toy store? A gift shop? A coffee shop? A hardware store? There are retailers all over the country that could start selling food in no time flat. Starbucks is part of the Austrian grocery cartel too? And there's still no evidence that authorities are turning a blind eye to price fixing other than 'price go up.'
Ask an Austrian hardware store owner why he doesn't sell food when he can supposedly undercut grocery stores and still make 5% profit on every item sold. I bet you anything he'll say that's bs.
i am not sure i understand what your argument is, or what you think mine is.
your last sentence suggests that you don't believe that anyone can just undercut the big supermarket chains in austria. which is what i also don't believe.
but your first sentence is saying something different, so that has me confused.
What will happen if a hardware store starts selling bread? Austrian grocery cartel thugs will show up and break his legs? Please explain in detail why you believe that coffee shops cannot sell bread without a multi-year planning and approval process.
It's bs that anyone not in the supposed cartel can suddenly make huge profits on food by undercutting. Gross margins on food are almost certainly very low. THERE IS NO CARTEL. There is no room to undercut. There is no evidence of illegal price fixing other than price go up. The only cartel is the Austrian government which is the cause of the price increases--not via lack of enforcement of laws but from carrying out their policies as written. This is inconvenient to the socialist talking point about corporations fixing the price of bread with impunity.
first of all, i agree with you. THERE IS NO CARTEL. there is no need to shout. the cartel is not the problem. aldi from germany successfully entered the market in austria with their hofer chain, and lidl is a german supermarket chain too.
but i also do not agree with you that it would be trivial to sell food anywhere.
brand protection laws here (i found a source for germany, but i believe that this should be EU wide, otherwise it would be in violation of EU laws) do not allow you to sell a branded product without the permission of the brand owner.
so in order to sell something you have to negotiate with the brand. if you are a small shop you will not get the same volume prices as the big chains because you have no bargaining power. and if you already sell something else you will have to convince them that doing that combining that is a good idea. (i also think that you may need a license to sell food alongside other products, which may be denied. you can't just sell everything anywhere). the brands may also not be happy that you undercut the large chains they sell to as it may push them to demand lower prices from the brand in order to compete.
i also found one article that claims that "Territorial Supply Constraints" would allow brands to segment the EU along the internal borders and demand different prices per region.
it looks like that may be the real problem.
and while it may be possible to buy the products from a third party within the EU, doing so may may be difficult at scale and make it more difficult to undercut prices. and also the complicated legal landscape risks costly lawsuits, even if you would win.
why aren't the existing german chains in austria undercutting others? probably because they buy directly from the brand and so the brand can dictate where they sell.
Your bargaining power is that there are a dozen other food suppliers and tens of thousands of other common food items you could sell instead. No store is going to cry and go bankrupt because they can't sell Ding Dongs. Also, there are chains of hardware stores, chains of coffee shops, chains of everything which have additional bargaining power. And if the selling price is so high then everyone is going to be eager to push as much through the pipe as possible while the getting is good.
>the brands may also not be happy
Too bad. There is no shortage of food brands. This is not North Korea we're talking about.
>why aren't the existing german chains in austria undercutting others?
Probably because to do so would mean giving up all profit. That may in fact be illegal predatory pricing--using their position in the market to squeeze out less solvent competitors.
i think aldi is known for not selling otherwise well known brands. but from my memory hofer in austria is selling way more common brands than aldi in germany.
the discounters are known for selling brand products under a different label. i guess the brands go along with that because that way their brands higher prices elsewhere are not undercut because consumers don't recognize that it is the same product. in fact at least in the past brands dictated the retail price for their products, and discounters created house brands because of that.
that's why you don't see many otherwise well known brands in their shops. but from my memory hofer in austria is selling way more common brands under their original label than aldi in germany. (i could not find much data on this though, so this is a very subjective impression. i also haven't been shopping in germany for decades. according to wikipedia, aldi (south) has common brand products from 11 companies, whereas hofer has 10% of their 1000 products with common brands. and many of those are austrian brands. ok, i just found an article where aldi south also claims 90% own brands, but i guess in both cases that's not an exact number, so that's not very helpful)
so it seems austrians have a stronger local brand loyalty.
why are there so many brands that are not shared by both?
i guess because austrians want products sourced in austria.
this is also true in business. austrian companies prefer to only do business with other austrian companies. when i suggested that i was looking for customers in austria i was told that having a company registered in austria was a prerequisite to be even considered.
this is probably because austrians see themselves as the underdog against germany, so they are very protective of their own and don't want to become dependent on other countries, especially not germany so they don't want german companies dominating the austrian market.
austrians wanting products from austria doesn't automatically make everything more expensive. it only makes it more difficult to open a store that attracts locals.
stores with imported products do exist but they don't have many of the products that everyone wants.
so you're saying that big business should have colluded to brainwash the population into liking foreign products? they should have had better marketing? or lobbied government to force the population to buy more imported goods? How exactly is big business even one percent to blame in this scenario?
