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Why do Norway's supermarkets have so little choice and high prices?

Robin-Ivan Capar
Robin-Ivan Capar - [email protected]
Why do Norway's supermarkets have so little choice and high prices?
Due to limited competition in the grocery industry, consumers in Norway are facing limited selection of groceries and high prices. Photo by Scott Warman / Unsplash

Norway's grocery industry is characterized by low competition, as few large players virtually dominate the industry. The lack of competition is limiting choice for consumers and driving up prices. Are there any signs that things are about to change?


Consumers in Norway find themselves tightly squeezed when it comes to both the selection of groceries and their prices. Even before the inflation crisis of 2022, a lack of competition in the grocery market limited choice and pumped prices up.

As the cost of living – not least energy – has skyrocketed this year, consumers are especially sensitive to changes in prices of day-to-day goods, and there has been a lot of debate on food prices in the country in recent months.

Is there any chance that things could change in the short term?

READ MORE: Which costs are rising the most in Norway?


A lack of competition as a fixture of the Norwegian grocery industry

The Norwegian Consumer Council has been warning that the lack of competition is a serious problem in the grocery industry for quite some time.

However, they don't believe it's likely that foreign competitors will be part of a potential solution.

"There is too little competition, in short. It's very difficult for businesses from Europe to enter the Norwegian market; we have fees at the borders that affect their imports of goods. These fees are in place to protect our own farmers, and that's probably the main problem," Olav Kasland of the Norwegian Consumer Council told The Local.

"And there's a broad political agreement on that (note: on protecting domestic products), which is probably here to stay. That's also part of the reason why we didn't join the European Union in 1994. There's a broad consensus on that. So to sum it up, the problem is that we have too few players, and the competition between them is too low.

"Keep in mind that it's difficult to compare Norway to other countries, as the structure is different. Norwegians tend to forget that we're a country of only 5.5. million people, not 55 million. We're no bigger than a major European city. So there's also a discussion on how interesting it is for chains to invest a lot in the Norwegian market," Kasland says.

What do consumers think?

While Norwegian consumers care about the prices of groceries, they're quite satisfied with the goods they're getting, according to Kasland.


"Consumers definitely care about the prices and would like more goods to choose between. However, in general, to be honest, consumers are quite satisfied with the goods they're getting in Norway.

"The position of the Consumer Council is that we should have more selection, more goods to choose between. If you go abroad, there's a broader spectrum of goods, and we would like to see that here as well.

"However, that has proven to be difficult (in practice). Lidl – a huge grocery company in Europe – tried to establish itself in Norway, but it failed. Others have also failed.

"There are plenty of reasons why. Norgesgruppen, Rema 1000, and Coop own the entire delivery chain, from A to Z. That is a problem; if someone from abroad wants to come in, they need to get their own logistics, and that's a challenge; they don't have the distribution network that the domestic chains do," Kasland points out.

Can the government change anything?

The ongoing inflation crisis has only made the situation in the grocery industry a more pressing issue for the Norwegian government, which is now looking at new measures to boost competition and lower the end prices for consumers.

READ MORE: How Norway’s government plans to tackle rising grocery prices


In a press release that the Ministry of Trade and Industry shared with The Local on Monday, Industry Minister Jan Christian Vestre pointed out that he is willing to consider all measures that can help consumers get a good selection and better prices.

He added that he would propose new, more concrete measures on Tuesday, October 25th.

"We must do this thoroughly, but we must also increase the pace of our work. Therefore, I will present concrete measures that we will continue to work on in the coming time," Vestre noted.

For his part, Kasland remains optimistic regarding the government's manoeuvring room to affect the competition between domestic players in Norway.


"We have been fighting for more competition for a long time. While import protections are likely to remain the same due to the aforementioned broad political consensus, something has to be done about the competition between big Norwegian chains.

"For example, the biggest player – Norgesgruppen – is getting bigger discounts compared to others, which means it is getting bigger profits than the others. Based on that, they continue to grow while the others stay in place or decline in terms of their market position. We're afraid that, in 20 years, we will have only two competitors in the market.

"Therefore, we need more transparency when it comes down to how chains are setting prices. That is what the government is doing at the moment, and we support it... Furthermore, we're watching market developments closely when it comes to inflation. On the one hand, groceries are becoming more expensive as a result. On the other, we don't want chains to pile on with extra prices for their own benefit to make bigger profits. We're afraid of that," Kasland warned.


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