Retail chains have slightly slowed down. The rate of price increases continues to rise but at a slower pace than expected. Currently, prices in stores are over 5% higher year-over-year.
In November, everyday shopping in stores became 5.5% more expensive year-over-year (YoY), just slightly more than the 5.4% YoY increase recorded in October. Of the 17 monitored categories, all experienced price increases this time, whereas previously, one category had shown a decline. In the past, even 2-3 categories had dropped in price YoY. The largest increase was in vegetables, which rose by 16.6% YoY. The TOP 5 categories of the most significant price hikes also included fats (10.4%), sweets and desserts (10.2%), dairy (8.1%), and fruits (7.4%). In contrast, the smallest increases were seen in pet food (0.2%), dry goods (0.4%), and household chemicals (0.6%). Toward the bottom of the list were children’s products (2.3%) and food additives (2.4%).
According to the latest report titled “Retail Price Index” by UCE RESEARCH and the WSB Merito University, prices in retail stores increased by an average of 5.5% YoY in November. This applied to food, non-alcoholic and alcoholic beverages, and other products across 17 categories. For comparison, the YoY increase was 5.4% in October and 4.9% in September.
– November’s price increase, though higher than previous months, was mitigated by retail chain promotions and intense price competition among discount stores. However, these factors are seasonal, and their impact on long-term price dynamics remains limited, explains Dr. Agnieszka Gawlik from WSB Merito University.
According to UCE RESEARCH analysts, preliminary estimates indicate that in the first nine days of December, the YoY price increase was 5.4%, the same as in October. There are also more promotional campaigns now compared to previous holiday seasons.
– It seems that retail chains have gently eased off on price increases. They do not want to discourage Poles from making holiday purchases. This trend is also influenced by the so-called price war among discount stores. Clearly, there is still fierce competition in the market for consumers’ attention. Therefore, price increases are not as high as experts predicted. Without these factors, shopping would certainly be more expensive, argue the authors of the analysis.
In November, all 17 monitored categories saw price increases YoY. In October, one segment recorded a decline, and in previous months, 2-3 categories experienced a drop in prices YoY.
– We have been in a rising price trend for quite some time. Therefore, this tendency across all segments should not be surprising. Of course, price increases in certain categories may temporarily slow down due to seasonal or specific factors, believes Dr. Justyna Rybacka from WSB Merito University.
Top Price Increases in November
- Vegetables led the ranking again, with a 16.6% YoY increase. In October, the increase was 11.1%, and in September, 10.8%. – November marks the end of the seasonal vegetable harvest in Poland, and available products now mainly come from storage, cold stores, or imports. Higher storage and transportation costs contribute to the price increase. Additionally, significantly lower vegetable yields this year play a role, adds Dr. Agnieszka Gawlik.
- Fats (butter, margarine, oil) followed with a 10.4% YoY increase. In October, they were outside the TOP 5, with a 6.9% rise, and in September, 3.8%. – We are once again seeing butter price hikes, an issue across Europe due to rising costs of raw materials, transportation, packaging, and labor, explains Dr. Rybacka.
- Sweets and Desserts came third, with prices up by 10.2% YoY. In October, they were second, with a 10.4% increase, and in September, 8.6%. – The high price of cocoa, energy, and transportation costs keep sweets and desserts in the top ranks for price hikes, notes Dr. Gawlik.
- Dairy increased by 8.1% YoY, moving up from fifth place. In October, dairy prices rose by 7.2%, and in September, by 4.4%. – High cattle maintenance costs, due to droughts and floods, and limited global milk supply contribute to this increase, says Dr. Rybacka.
- Fruits saw a 7.4% YoY increase, dropping from third place in October (9.9%) and September (10.1%). – In the fall and winter, imported fruits increase supply, tempering price pressure caused by poor local harvests, explains Dr. Gawlik.
Categories with Smallest Price Increases
- Pet Food: 0.2% YoY increase (compared to a -0.4% decrease in October).
- Dry Goods: 0.4% YoY increase (down from 7.8% in October).
- Household Chemicals: 0.6% YoY increase (down from 1.2% in October).
Research Methodology
The data is from the monthly report “Retail Price Index” by UCE RESEARCH and WSB Merito University. The latest edition compares data from November 2024 to November 2023. The analysis covers 17 categories and over 100 commonly purchased products, comparing over 92,000 retail prices from more than 46,000 stores across 61 retail chains, including discounters, hypermarkets, supermarkets, convenience stores, and cash & carry stores.
Source: Manager Plus
