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Ieva, a reader of the tv3.lt portal, recently visited the Lidl store near her home.
“I thought before that I should buy a new jacket. I don’t usually buy clothes at Lidle, but I just saw their ad, which was exactly the same red color and a similar pattern as I thought,” said the Vilnius resident.
So, according to her, she decided to go through the store and touch with her fingers what was the fabric of the garment, how it was sewn.
“Of course, this is not a single item from the nominal collection, no special quality can be expected. But the price is relatively small: 19 euros. However, I thought I would still go online and see where else it can be found, ”Ieva recalled.
According to her, while browsing the Internet, she remembered that acquaintances used to go shopping in Poland quite often. Not just food, but other goods.
“In a word, I somehow decided to look at the Polish Lidlo page as well. And what do you think about yourself? The same jackets are also sold there now and, guess three times, where is the lowest price?
According to her, the same jacket was priced at PLN 55 in Lidl stores in Poland. At the official exchange rate of the Bank of Lithuania, this would be 12.14 euros.
Thus, in the stores of the same retail chain, the price of the same item differs by more than a third.
By the way, the usual rate of value added tax for clothes in Poland is 23% and in Lithuania it is 21%, so if the prices differed only because of taxes, they would be lower with us.
“I understand that sellers set the price as they see fit. But it is still strange that by earning less than the same Poles, we have to pay more for the same things. What to talk about sales. If you can really buy cheap in Germany or England, I have never seen us reduce the price normally without any tricks ”, Ieva was surprised.
Lid Skersytė, Public Relations Representative for Lidl Lietuva, explained the differences in prices for the same item as follows:
“In each country, prices are set individually, taking into account the market of that country. Our goal is to offer the best value for money in all markets. A comparison of different markets is not possible due to a number of factors that affect the selling price. “
Prices are lower not only in the poorest countries
The statistical agency of the European Union, Eurostat, recently published the price level of various categories of products in the different countries of the Community.
Assuming that the overall EU clothing price level last year was 100%, it was 101.7% in Lithuania (103.1% in 2018). This means that, compared to Europeans, clothing prices in our country are statistically at least 1.7 percent. highest point.
This is probably welcome, because in Estonia, for example, in 2019, the price level for clothing was 109.5 percent. Price level of the EU and Latvia: 103.8 percent. In Poland, on the other hand, the figure was 92.7%. – about a tenth less than in our country.
Thus, in 2019, the highest levels of clothing prices were recorded in Iceland (135.6%), Denmark (132.3%), Switzerland (127.1%) and Norway (122.6%).
The lowest are found in Spain (89%), the United Kingdom (88.4%), Romania (81.8%), Hungary (81.1%) and Bulgaria (78.6%).
State size and cultural differences
Swedbank chief economist Nerijus Mačiulis did not emphasize the fact that prices in Lithuania are only slightly higher than the EU average.
“It just came to our attention then. I would say, actually, it’s almost 1 percent. Of the average there are errors in the frames.
But perhaps one of the main reasons is the size of the market. Because, for example, in Poland, if we think about the fixed costs per unit of clothing or footwear sold (they are related to the rental of premises, employee salaries, etc.), fewer units of clothing or footwear are sold per square meter of rented space than in the state. with a larger population.
As a result, it is more difficult to cover those fixed costs and affects the final price; I found one of those economic reasons, ”said the economist.
However, in Slovenia, for example, in other countries of similar size, both wages and population are similar. Why are the prices lower there?
“Again, what constitutes a basket whose prices are measured must be evaluated here. Perhaps more luxury clothing is sold or it is more well-known clothing brands in supermarkets, which are usually cheaper. There are no such good reasons why they are so expensive. After evaluating the salary and other costs, their price should be similar, ”N. Mačiulis commented.
However, in summary, he identified two main reasons why clothing prices can vary significantly from country to country:
“Due to low turnover, it is difficult to cover the fixed costs, this is reflected in the price. Another is that there may be some cultural differences that lead to a greater weight of more expensive brand clothes in the consumer basket.”
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