From the personal shopping of yesteryear, to today when orders are made online, the idea that shopping comes to the consumer’s door free of charge has become something of an axiom.
But how much do supermarket chains “bear” free distribution – even above a certain amount?
The rapid growth of e-grocery, the digital shopping channel for supermarket items, since the pandemic shows that the cost of this provision is becoming a “thorn” in the profitability of the chains. And that’s because no business makes a profit from online sales.
Charges are coming
“The cost from receiving the order to the delivery of the products to the customer, which is not small, is not passed on to the final consumer with increased charges”, executives of the supermarket chains pointed out.
But because e-sales of supermarket items have their own momentum, which is growing, no one is abandoning the electronic channel and everyone is looking for optimal solutions to “break even” the costs. Hence the prospect of establishing distribution charges is considered almost certain and may even come into force in the coming months.
“All retailers charge freight for e-commerce orders,” say supermarket industry executives, estimating that for chains to be profitable in the process of distributing products, the distribution fee must be at least 10% of the total value of each order.
What consumers are saying
However, consumers are particularly sensitive to the issue of charges and especially in the current inflationary situation, changes in the status of online orders certainly do not go unnoticed.
For example, the issue of transportation is the second most important factor for choosing an e-shop, according to the research results of Focus Bari.
In particular, 59% of the respondents have free shipping as the main criterion for choosing the store. At the same time, however, consumers recognize that free shipping is not always possible. Thus, answering the question “what is the amount below which transportation is considered fair per category” they consider, indicatively, 90 euros for large electrical appliances, 52 euros for furniture, 38 euros for shoes, 31 euros for books and 30 euros for games.
Fewer items in the online cart
As far as the dynamics of the turnover of electronic supermarkets is concerned, the course of sales this year is almost stable, but the growth is based, as is the case in physical stores, on price increases.
Specifically, during the first quarter of this year (data up to March 26), the value sales of online supermarkets increased at a rate of 6.7% to 61.1 million euros, based on the data presented by Panagiotis Gezerlis, founder and head of Convert Group, during NielsenIQ’s Shopper Trends Event.
In contrast to the increase in value sales (88% of online supermarkets and quick commerce partnerships are included), volume was down, as items in the average consumer basket were 10.1% fewer.
It is estimated that the decline in sales volume this year is linked to the steep decline in the intensity of offers by 13.6 points.
At the same time, the increased participation of private label products in the online turnover of organized retail businesses is noteworthy, as their share in value has reached 15.2%, increased by 1.5 points compared to the first quarter of last year. In terms of volume, the private label share in the supermarket online channel reaches 18.7% (+1.4 points).
It is recalled that in 2022 the online supermarket industry grew at a rate of 5%, with the total value of purchases reaching 266 million euros at retail prices including VAT, but not including the Q-Commerce players Box, eFood Market, Instashop, Pop Market, Rabbit & Wolt which are constantly gaining share in the Greek market.
Latest News
Bank of Greece Governor Says EU will Retaliate to Trump’s Tarrifs
The Bank of Greece Governor defended the independence of central banks amid criticism from U.S. President-elect Donald Trump, who had publicly commented on Federal Reserve Chair Jerome Powel
September in Greece Winning Tourists Over from US, Germany
Tourists continue to visit Greece off-season into Sept. with the number of inbound travelers up by 6.6% and a 7.9% rise in travel receipts.
Bitcoin Surges Toward $100K Amid Pro-Crypto Optimism in US
According to Reuters, the cryptocurrency surged to an all-time high, briefly exceeding $96,898 during Asian trading hours.
Greek Driver Violations at a Touch of a Button
Traffic offences recorded in the last five years by Greece’s “Driver Behavior Control System” are now available on Gov.gr Wallet
Milan Tops List of Most Expensive Streets, Athens’ Ermou Holds Steady at 15th Place
In Athens, following Ermou Street is the southern suburb of Glyfada and Tsimiski Street in Thessaloniki.
New Gov.gr Service Enables Secure Reporting of Minor-Related Delinquency
It should also be noted that via the recently introduced initiative ‘Safe Youth’ application citizens have access to specially tailored informative material regarding the safety of children and adolescents
Thousands Strike in Athens Over Soaring Living Costs and Stagnant Wages
Inflation, particularly in food prices, has been crushing Greek households
Greece Overhauls Property Valuation System
Greece plans to launch a revamped property value registry in 2025 and overhaul the way objective values are calculated to enhance tax revenue and improve transparency.
Greece’s New Tax Bill Foresees Tax Relief Beyond Big Business
Tax relief measures in Greece are proposed for freelancers, property owners and farmers, along with 'big business'
Unions Call Nationwide Industrial Strike for Wed.
Mass transits are usually affected, especially in the greater Athens-Piraeus area, although bus and metro services are curtailed but not fully halted