Published: 2023-05-10
In Hungary, the government is launching an online price monitoring system in July to control the soaring inflation rate, which is still the highest in the European Union at 25.6 percent. The system aims to promote transparency for comparing prices and baulking overpricing. Moreover, it will enable customers to understand better how retailers are setting prices.
Objectives of the Online Price Monitoring System
The primary goal of the online price monitoring system is to control the increasing inflation rate, which leads to rising prices of essential goods and services. Also, it targets big supermarket chains, including Aldi, Lidl, Spar, or Penny, to regulate their pricing strategies and provide uniformity across the marketplace. The system is a platform to support healthy competition in the market that leads to reduced prices.
Working of the Online Price Monitoring System
The online price monitoring system will follow the daily and customer loyalty prices of the target products in every supermarket. Each company will upload all the relevant prices by the end of the preceding day, and stores will have to submit target product prices for the previous year until August. The database will have prices for 60 target product categories, including items like pork leg, white bread, milk, cheese, apples, sausages, margarine, butter, and spaghetti. The Hungarian Competition Authority will operate the database, and stores not subject to the scheme may join the initiative voluntarily.
Impact on Shopping Experience
With the introduction of the online price monitoring system, the shopping experience in Hungary will change. Customers are encouraged to compare prices online before visiting a store to make informed decisions. The system aims to provide customers with an online database, promoting transparent price comparison, baulking overpricing, and highlighting reduced prices of essentials. Consumers can expect uniform pricing across every store, healthy competition, and gradually decreasing prices of products.
Conclusion
The Hungarian government's decision to launch an online price monitoring system to control inflation is a promising initiative. The system aims to provide an environment of transparency and healthy competition, leading to a decrease in essential products' prices. By allowing customers to compare prices online and baulking overpricing, the government hopes to have one-digit inflation rates at the end of the year. The initiative will also ensure that retailers set uniform prices, resulting in a better shopping experience for customers.
Questions & Answers
What is Hungary's new online price monitoring system? Hungary's new online price monitoring system is a government initiative that aims to provide an online database for customers to compare prices transparently and to prevent overpricing and reveal how retailers are pricing.
When will Hungary's new online price monitoring system begin? Hungary's new online price monitoring system will kick off on 1 July 2022.
Which supermarkets are targeted by Hungary's new online price monitoring system? Big supermarket chains like Aldi, Lidl, Spar, or Penny are targeted by Hungary's new online price monitoring system.
What products will be monitored by Hungary's new online price monitoring system? The online price monitoring system will follow the daily and customer loyalty prices of the target products at each supermarket. First, the database will contain the prices of 60 target product categories, including pork leg, white bread, 1.5 percent ESL milk, Trappista cheese, idared apples, sausages, margarine, butter, and spaghetti.
Will reduced prices be considered by Hungary's new online price monitoring system? No, reduced prices will not be considered by Hungary's new online price monitoring system because of the product's shorter than 72h expiration date.
Which stores are subject to compulsory data reports by Hungary's new online price monitoring system? Supermarkets that had net income above HUF 100 billion (EUR 270 million) in 2022 would be subject to compulsory data reports by Hungary's new online price monitoring system.
Do stores not subject to the scheme have the option to join Hungary's new online price monitoring system voluntarily? Yes, stores not subject to the scheme may join Hungary's new online price monitoring system voluntarily.
Who will operate the database of Hungary's new online price monitoring system? The Hungarian Competition Authority will operate the database of Hungary's new online price monitoring system.
What is the goal of Hungary's new online price monitoring system? The goal of Hungary's new online price monitoring system is to provide an online database for each customer, allowing them to compare prices transparently. As a result, the cabinet hopes they can baulk overpricing and reveal how retailers are pricing. Moreover, they would like to boost competition in the market. As a result, prices may start to decrease in Hungary.
What is Hungary's current inflation rate? According to telex.hu, Hungary's inflation rate is still at the top in the European Union at 25.6 percent.
When did Hungary's inflation reach this high rate? In March 2022, Hungary's inflation rate reached 25.2 percent.
What are the major contributors to Hungary's high inflation rate? Household energy prices rose by 43.1 percent in Hungary, and concerning food, the inflation rate was 42.6 percent compared with last March.