President of Spanish supermarket giant Mercadona hits back over price rises
FINANCE ·
Roig said that profits are necessary: "If there is no profit, you can't reinvest, you can't expand, you can't update assets".
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Roig said that profits are necessary: "If there is no profit, you can't reinvest, you can't expand, you can't update assets".Raquel Merino
Malaga
Wednesday, 15 March 2023, 14:43
The president of Mercadona, Juan Roig, announced the annual results of the Valencian company on Tuesday as he made a plea in defence of companies and their profits.
Roig justified the increase in prices by arguing that if they had not been raised, "the disaster in the production chain would have been impressive".
"Mercadona has acted as a price containment dike, by being able to implement numerous measures to reduce costs and improve productivity," he said.
Roig said that Mercadona has reduced its margin, 0.6% lower than in 2021, by "avoiding transferring part of the cost increase suffered to the final price". He explained that the prices of the products it sells on its shelves have risen by an average of 10%, compared to the 12% increase experienced by the cost prices at source. "We have reduced the margin by 140 million euros to support the inflation that we had to pass on to our bosses (clients)," the supermarket chief said.
Roig also said that Mercadona "has fought" with suppliers "a lot" to try not to raise prices. "We have had a milk supply crisis because we have tried not to raise prices. We were a month and a half without milk. If you don't raise prices, you run out of product".
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