By maintaining the margin freeze for too long, the government overshot the target, but the harmful effects are now becoming more pronounced.

The margin freeze was not suitable for keeping food prices under control in the first place. The real problem is not the trade margin, but the cost-based price pressure coming from food producers and suppliers. For this reason, the margin freeze could not have had a lasting positive effect, but its harmful effects are reflected back on consumers. Due to their losses, large food chains are unable to launch really good promotions and implement developments, and the turnover of smaller stores is declining because customers prefer to shop in large chains due to artificially depressed prices. 

In the near future, we may also experience the consequences of the fact that retail has lost its means to dampen market tensions due to the margin freeze. The sector is facing the challenges looming ahead, such as the tensions in the milk and dairy product chain or the impending energy crisis, with an inherently distorted price structure and, therefore, inflexibility built into the system

– says Tamás Kozák, Secretary General of the National Trade Association, in a recent OKSZ statement.