Price Hikes Loom in Greece After Easter Market Calm

With the Easter play present over—during which supermarket shelves and refrigerators remained mostly stable contempt earlier fears—the marketplace is entering what insiders picture arsenic a “high-risk zone.” After six weeks of war successful the Middle East and the illness of the latest bid talks, the planetary situation is erstwhile again turning bleak.

Oil prices proceed to climb, and the vigor marketplace is placing unbearable unit connected businesses. As is widely known, astir suppliers of user goods refrained from raising prices during the Easter period, choosing alternatively to enactment smoothly successful the aggravated “war of offers” that characterizes vacation retail. However, they had already signaled that they would reassess their commercialized strategies aft Easter. In the meantime, they absorbed the excess costs caused by rising vigor prices—costs that impact everything from operations to transportation.

For galore companies, however, the situation created by the war successful the Middle East is acold much analyzable than it appears. Export enactment to the portion has already been suspended. While the bulk of Greek exports to the country consists of fuel, for companies exporting different products, the gross nonaccomplishment is still significant.

This creates a treble burden: connected the 1 hand, declining outer sales; connected the other, rising operational costs. In such cases, terms increases are nary longer optional—they are inevitable. Even for companies without nonstop vulnerability to Middle Eastern markets, the quality to sorb further costs has its limits.

As a result, it is present an “open secret” within the marketplace that the coming weeks will bring a wave of terms hikes. Importantly, these increases are not expected to boost nett margins, arsenic a government-imposed headdress connected gross nett margins—introduced done an exigency legislative act—remains successful force.

At the aforesaid time, existing regulations stipulate that if a institution raises prices, it cannot beforehand immoderate subsequent terms reductions arsenic “offers” to consumers.

Nevertheless, the unit from rising costs—and the necessity of passing them on—outweighs the benefits of maintaining promotional campaigns for a constricted period, such arsenic three months. At least, that is the view expressed by marketplace sources.

Profit margins under scrutiny

Meanwhile, regulatory oversight is intensifying. As antecedently reported, Greece’s Independent Authority for Market Supervision and Consumer Protection has requested elaborate information from 110 companies—57 of which are nutrient manufacturers—on their gross nett margins, breached down by product, and however these margins are calculated.

The archetypal deadline for submitting this information expired today. However, companies were unable to hole the required documentation successful clip and requested an extension. According to sources within the authority, the deadline is expected to beryllium extended until adjacent Monday, aft which inspections will begin.

Notably, the aforesaid sources expressed skepticism astir the standard of the outgo load claimed by suppliers, suggesting that it whitethorn beryllium manageable—particularly successful the discourse of protecting user income.

Taken together, these developments constituent to a captious signifier for Greece’s user goods market. With planetary instability driving costs upward and regulatory unit mounting astatine home, businesses and consumers alike are bracing for what could beryllium a difficult—and much expensive—period ahead.

Source: tovima.com