Migros, one of Switzerland's largest supermarket chains, has announced significant price reductions across a range of products in an effort to counter the growing market share of discount retailers Aldi and Lidl.
The price cuts are expected to affect over 1,000 products by the end of 2025, starting with more than 60 everyday items. However, there are concerns from the farmers' association regarding the potential negative impact on local agriculture.
Economist Mathias Binswanger has expressed skepticism about whether Migros's strategy will be effective in the long term, suggesting that while price reductions may attract customers initially, they could lead to unsustainable practices that harm local farmers.
Aldi and Lidl have indicated that they will likely adjust their prices in response to Migros's cuts to remain competitive. The implications of Migros's pricing strategy extend beyond consumer savings; they pose significant challenges for local agriculture.
The farmers' association has warned that the strategy could jeopardize the livelihoods of farming families and lead to a detrimental cycle of undercutting that harms the agricultural sector. The success of Migros's plan will depend on the extent of the price reductions and the specific products affected.
It is important to maintain quality alongside lower prices to ensure consumer loyalty. The ongoing price competition among retailers raises critical questions about the sustainability of the Swiss retail landscape and the delicate balance between offering competitive prices and ensuring fair compensation for farmers.