According to index.hu Hungarians have to pay more for certain products than Germans. This is a painful discovery as Hungarians are usually upset to learn that something is cheaper in the “rich West” – especially if we consider the fact that in Germany the average salary is about twice of ours.
Recently we wrote about the shocking number of Hungarians predicted to leave the country. In contrast, a reader of Index is just planning to return from Germany, but had to discover the sad difference in prices.
The very same razor and shower gel, in the same drugstore chain, cost more in Hungary than in Germany.
How much is it really?
Index compared the price of certain products based on the German and Hungarian webpages of the drugstores DM and Rossmann. Similarly to the realisation that German history sometimes equals Hungarian reality, our country again got the worst of it: several products are indeed more expensive here.
Of course, we must keep in mind that there are several influencing factors. The products are more or less the same, but they often come in different packaging. For example, a bottle of shower gel and hairspray has more or less content here, razors sometimes come with three replaceable heads and sometimes with none. Not to mention that depending on the size of the packaging, the price differs within one market as well, and we should not forget about the different discounts and special offers either.
However difficult it is to make comparisons,
certain products are available in the same packaging, proving the assumption that we must pay more for those than the wealthier Germans.
Let us see a few examples:
- A package of four razor replacement heads for men from a well-known brand costs 13.95 € in the German DM, which (counting with an exchange rate around 323 HUF) translates into 4515 Forints, while the same product here costs 7499 Forints
- Similarly, in Rossmann, a different set of eight razor replacements heads from the same brand is priced at 99 €, that is 6793 Forints, while in the Hungarian stores it is 7999 Forints
- The hair sprays of another well-known brand are available in Rossmann for 1.59 € (514 Forints) for the German customers, while Hungarians pay 999 Forints for it
- Taking a look at shower gels, the same product in Hungary costs 729 Forints, while in the German DM it is only about 437 Forints (1.35 €).
Taxes and economies of scale are to blame
– or at least these were to two main reasons according to the interviewed drugstores.
As far as taxing is concerned it is easily understandable: the VAT is much higher in Hungary. Here 27 percent of the price goes to the treasury in the case of most products, while in Germany it is only 19 percent. So even if the price of the products were the same without VAT, they would cost more in Hungary.
However, they do have different prices.
Why is that? We must consider that the population of Germany is more than eight times bigger, so eight times more people take showers, shave, spray their hair and so on. Therefore the German Rossmann, DM or Müller can purchase products for a larger market in larger quantities – and thus for less money. Although the drugstores and the companies manufacturing the products – such as Procter & Gamble or Henkel – are global multinationals, purchasing is not centralised, that is, the Hungarian Rossmann gets its products from the Hungarian or regional Procter & Gamble.
In addition, there are extra costs involved in the final price such as the cost of delivery, packaging, and labelling, plus the administration of the products and so on. Nonetheless, in the end, we still take a shower or shave for more here than people in Germany.