Dutch shoppers favor store brands as A-brand prices soar

Dutch consumers are increasingly buying supermarket store brands as the price difference with A-brands grows, according to recent market research. Store brands now account for nearly 60 percent of supermarket sales, FD reports.

Supermarkets benefit from the trend, as they typically earn higher margins on their own products. Over the past three years, prices for A-brand products have risen 31 percent, while store brand prices increased only 20 percent. As a result, A-brands are now on average 40 percent more expensive than store brands, compared with 34 percent three years ago. Price differences vary considerably across products.

Store brands are produced by lesser-known suppliers on behalf of supermarkets, giving retailers more control over pricing and the ability to keep prices lower.

Rising grocery prices continue to push shoppers toward cheaper options. Statistics Netherlands (CBS) reported that food prices in August were 3.7 percent higher than a year earlier, with coffee up 22 percent, meat up 8 percent, and dairy up 5 percent.

Rabo analyst Sebastiaan Schreijen highlighted the widening price gap: “In three years, A-brand products have become 31 percent more expensive, while store brands rose ‘only’ 20 percent. This makes A-brands on average 40 percent pricier than store brands, up from 34 percent three years ago.”

Despite the rise of store brands, A-brands remain important. Kitty Koelemeijer, marketing professor at Nyenrode Business University, noted that A-brands continue to attract consumers to supermarkets. “In that respect, the A-brand has not lost its strength,” she told FD.