The most common mistake in public discussion is to confuse price indices with retail markups or profits, the Association for Modern Trade (AMT) said in a statement on Monday. The statement come in response to Commission for Consumer Protection (CCP) Chair Maya Manolova’s claim that markups on some dairy products at major retail chains exceed 140%.
The Association said that when a price index for a product is 140, this means its price in Bulgaria is 40% above the EU average, where 100 is the benchmark, rather than that the retailer applies a 140% markup or earns a 140% profit.
According to AMT, Eurostat measures comparative price levels against an EU average of 100. It cited data showing that Bulgaria’s overall price level for goods and services is 62.5% of the EU average, the lowest in the bloc, while food prices stand at 92.6% of the EU average.
The Association said some key food categories are considerably cheaper in Bulgaria than the EU average. Bread and cereals stand at 81.4% of the EU average, or 18.6% lower; meat at 71.5%, or 28.5% lower; and fish at 87.1%, or 12.9% lower, according to the statement.
AMT also argued that Bulgaria’s 20% VAT on food pushes up shelf prices. It said the country produces only around 10% of the butter it consumes, with the remaining 90% imported at international market prices, to which transport and storage costs are added.
After VAT, refrigerated transport, electricity, wages and losses from unsold goods are taken into account, retailers’ net profit is only around 3%, the Association said.
AMT also disputed claims that major retail chains control more than 70% of Bulgaria’s food market. It cited data from the National Statistical Institute and the Institute for Market Economics showing that the revenues of major retail chains account for slightly more than half of the total food market.
The Association called on the CCP to clarify how many products it inspected and how many were found to have markups of around 150%, as well as what the lowest markups were for key products. It also asked why only the highest individual figure was being highlighted without figures for the other products inspected.
AMT stressed that a markup is not the same as profit, as the difference between the purchase and retail price also covers VAT, electricity, transport, wages and losses from unsold goods.
The Association also questioned why comparisons with other European countries did not take Bulgaria’s 20% VAT rate into account and why inspections focused only on the final stage of the supply chain, the retailer. It asked whether increases in wages and production costs among processors had also been examined.
AMT said inspections were appropriate for identifying violations and that it supported sanctions where wrongdoing was proven. However, “publicly pointing fingers and administrative pressure do not make shelf prices lower,” the Association said.
Association for Modern Trade Disputes Consumer Watchdog’s Claims on Retail Food Markups THE NEWS FROM BULGARIA – NEWS AGENCY 2009-2025 2026-10-12 14:43:00
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