Shoppers in the Republic are paying as much as 31 per cent more for branded goods when compared with consumers in Northern Ireland, even when prices are adjusted for VAT and excise duties, a study published by the National Consumer Agency (NCA) has revealed.
The study compared the cost of baskets of goods in Tesco, Dunnes Stores and Lidl shops on both sides of the border and while there was a significant mark-up on branded goods in the Republic, there were smaller differences in the price of own-brand goods.
National Consumer Agency chief executive Ann Fitzgerald
A basket of 42 branded goods is 31 per cent more expensive in Dunnes Stores shops in the Republic while there is a 28 per cent difference between a similarly sized basket of branded products in Tesco outlets.
Own-brand Tesco products meanwhile are 17 per cent more expensive south of the border while the differential between own-brand Dunnes Stores products was 11 per cent. Lidl products in the Republic were 16 per cent dearer.
All the price differences were after product prices were adjusted for VAT and excise duties.
The chief executive of the NCA, Ann Fitzgerald said the substantial price differentials were inexplicable "even taking account of different business models and costs in the two jurisdictions".
She said that, in spite of claims from retailers that the cost of doing business in the Republic was higher, it was "interesting that there is a much lower price differential on own brand goods". She said lower prices in the own-brand market was a consequence of greater competition due, "at least in part" to the presence of Aldi and Lidl.
She pointed out that Irish people had a tendency to purchase branded goods and accused retailers of "charging us for that preference".
The NCA also found greater competition in the Northern Ireland grocery market than in the Republic. According to its survey, there was a €2.40 difference between a basket of 22 items in Tesco and Dunnes Stores shops in Northern Ireland while south of the border the same basket was identically priced.
"We believe that the greater number of players in the Northern Irish market contributes to competition but the concentration of just a few main players in the Republic of Ireland market is leading to price matching," Ms Fitzgerald said.
