WHAT'S THE STORY WITH PRICES?
LIDL AND ALDI have got so much positive press in this country over the last 12 months that you’d swear the two German discounters had set up shop here a decade ago as a charitable gesture intended to save us from the rip-off merchants who had been bleeding us dry for years.
While Tesco, Marks & Spencer, Dunnes Stores and dozens of other retailers have been taking the flak for charging shoppers in the Republic prices which are, by any definition, wildly out of sync with their counterparts across the Border, Lidl and Aldi have neatly sidestepped much of the criticism.
The pair have pointed towards repeated National Consumer Agency studies showing them to be cheaper than more established competitors. While the surveys are undeniably true and while both stores have, by any reckoning, shaken up competition in the Republic, this doesn’t paint the full picture.
Behind the headlines and surveys, the two outlets have been as guilty as anyone when it comes to charging shoppers in the Republic considerably more than their customers in the UK or on their home turf in Germany.
A comparison by Pricewatch last month found that some products on the discounters’ shelves in Ireland cost as much as 158 per cent more than they do in Germany, while the price difference between Lidl and Aldi shops in the Republic and the UK are routinely in excess of 30 per cent. While neither chain is naive enough to put sterling and euro prices on their products – as M&S, Tesco and Dunnes often do – it’s still not hard to make comparisons.
Shoppers visiting Lidl’s Irish website are confronted with a page asking them to select Northern Ireland or the Republic. Last week people who clicked the Northern Ireland option were being asked to pay a total of €38.14 (after conversion) for a selection of four products: £6.99 (€7.96) for a case of Stella Artois; 99p (€1.13) for a jar of Nutella; 49p (€0.55) for pancake mix and £24.99 (€28.50) for a car creeper to slide under your car (well, it is Lidl).
In the Republic, the Stella cost €11.99, the Nutella was €1.75, the pancake mix was 69 cent and the car creeper was €34.99, taking the total spend to €49.42 for the same four products.
It is much the same story in Aldi. In the UK a bag of Oven Cut Steak Chips costs £1.09 (€1.24); the same product in the Republic is €1.99. Crispy Aromatic Duck, which has a price tag of £3.99 (€4.53), sells for €5.79 in the Republic, while Natural Haddock Fillets that sell for £2.99 (€3.40) in the UK cost €4.49 in the Republic. Irish shoppers who fancy an Aldi apple strudel will pay €1.69, compared to 99p (€1.12) in the UK. If you wash it all down with a box of French Shiraz it will cost £9.99 (€11.35) in the UK, compared to €18.99 in the Republic. The total cost of the five items in the UK is €21.64 – but €32.95 in the Republic.
The prices Irish shoppers are asked to pay at the two discounters are made to look even more extravagant when compared to prices on offer in Aldi and Lidl’s German outlets.
A comparison by The Irish Timesfound the greatest price discrepancy for Lidl's Saskia bottled water, which is 158 per cent dearer in Ireland than in a Berlin store. Meanwhile, its pocket tissues cost 106 per cent more here.
In Aldi, the same Moser Roth orange-almond chocolate bar is 78 per cent more expensive in Ireland, while a kilo of flour is three times the German price.
Haribo sweets – one of the few products stocked by both Lidl and Aldi – are 50 per cent more expensive in Aldi Ireland, while Lidl Ireland charges 43 per cent more than in their German stores.
“It doesn’t shock me, but disappoints me to the core,” says Dermott Jewell, chief executive of the Consumer Association of Ireland, of the prices. “It’s extraordinary that Aldi and Lidl would be seen in Ireland as the only game in town if you want to have enough money to feed the family and have some money left over. And yet they are still bleeding us dry.”
Only Aldi sugar and toilet paper were identically priced in both countries; nappies and washing powder were marginally cheaper. No Lidl products compared were the same price or cheaper in Ireland.
There are several caveats regarding these comparisons. Aldi and Lidl have adjusted their no-frills formula here to Irish tastes and incur higher costs as a result, with more staff and with more fresh food on shelves here, for instance. The comparison ignores VAT, ranging from zero to 21 per cent in Ireland and 7 to 19 per cent in Germany.
Like-for-like comparisons are limited between Aldi stores in Ireland and Germany because only a few identical products are stocked. Identical brands in Lidl stores were consistently more expensive in Ireland: ie Coca-Cola (38 per cent dearer), Maribel Apricot Jam (45 per cent), and After Eight chocolates (50 per cent).
ASKED ABOUT THEdiscrepancies, a spokesperson for Lidl cited recent record property prices, transport and insurance costs, and smaller economies of scale. "We are working hard to offer the best value to Irish customers, but the high-cost economy we're in hampers the ability to bring prices down as far as in central Europe," the spokesperson said.
An Aldi spokesman said pricing in each country was decided locally, taking into account the local cost base, the scale of operation and product sourcing. He said the store sourced 40 per cent of its stock from Irish suppliers. “Many of these products could be sourced cheaper internationally, however Aldi is committed to supporting the local economy and to providing its customers with the quality and product taste they demand.”
Jewell suggests allowing a 12 per cent price premium for German retailers operating in Ireland. The only product in the two shopping lists near that margin was Lidl W5 washing-up liquid (12 per cent dearer in Ireland).
“The biggest cause of concern is that if these are the prices Aldi and Lidl sell at,” says Jewell, “then what must it be like for Tesco, Dunnes and the rest?”
