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Thursday, June 20, 2024

Grocery stores log more high profits

Norway’s grocery store owners have long been among the wealthiest in the country, and the rich have gotten richer during the Corona crisis. With borders to Sweden closed, restaurants shuttered and Norwegians mostly stuck at home, the dominant retailer and wholesaler NorgesGruppen has enjoyed record revenues and paid out huge dividends to the family owning it.

At a time when records numbers of Norwegians are laid off, and going to the grocery store can be the only outing of the day, the owners of Norway’s biggest grocery chains are raking in record profits. PHOTO: REMA 1000

At a time when around 200,000 Norwegians are laid off, state broadcaster NRK has reported how the owner of major grocery store chains including KIWI, Meny, Spar and Joker has raised prices and paid out a large bonus to its chief executive. Norges Gruppen reportedly logged operating earnings of NOK 101.5 billion (USD 11.9 billion), an increase of more than NOK 10 billion over the year before. NRK reported that CEO Runar Hollevik received a bonus of NOK 3.85 billion.

The profits set off immediate reaction in Parliament, which has been grappling with Norway’s high food prices and grocery store concentration for years. While REMA 1000 and Coop have also generated high profits and paid out big bonuses and dividends, NorgesGruppen has especially been accused of stifling competition through its sheer market dominance.

“I think a larger portion of these record profits should have been passed on to customers,” MP Kårstein Løvaas of the Conservatives told NRK. NorgesGruppen itself cites a weak krone last year and higher prices from suppliers. Others, including market researcher Ivar Pettersen, claim the grocery stores have done a good job maintaining supplies and keeping shelves stocked during a difficult year that also has led to higher costs.

Newspaper Dagens Næringsliv (DN) editorialized that in private business, results belong to their owners, not customers. DN noted, however, that Norway’s competition authority continues to investigate possible violations of competition law, while Norway’s trade minister has demanded that suppliers charging different wholesale prices to various customers must clarify the practice to the authorities. staff



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