The Ministry of Economic Development and the Ministry of Agriculture announced on Wednesday that they have drawn up the detailed rules, and social consultation of the draft will soon begin in the case of mandatory actions for food retail.
According to the regulations announced by the government, there will be shops in the order of thousands, where it is mandatory to hold weekly promotions in 20 product categories. According to the announced provisions, this means that for each of the twenty main groups, at least 1 discount item must be kept, which must be at least 10 percent cheaper than the lowest price in the previous 30 days.
According to the criteria described in the GFM announcement, the mandatory promotion applies to those traders who are engaged in activities indicated under the designation “4711 – Miscellaneous food retailing” according to the TEÁOR, and whose sales revenue in 2021 exceeded HUF 500 million.
It could be assumed from the outset that this would apply to the largest store chains, including Lidl, Spar, Tesco, Auchan, Penny and Aldi, since the sales revenue of the companies involved was well over a hundred billion two years ago.
The networks of the companies involved currently include thousands of stores nationwide, so more than 600 Spar units are operating, Aldi is present with around 150 stores across the country, Lidl has 200 stores, and Penny and Tesco have more than 200 stores.
What is new, however, is that the unit of the Hungarian networks operating in the franchise system also fall under the relatively low turnover criterion of exceeding 500 million in 2021,
thus also a significant part of the stores of Coop, CBA/Príma and Real.
If all chains are taken together, then the largest, all market players listed above, have about 9,000 stores. However, not all of these will fall under the scope of those affected by the franchise networks, but the system will almost certainly apply to around 3,000.
Surprisingly, the regulation also applies to companies that have even just one business premises: the Opt according to his data, there were a total of 381 companies or entrepreneurs whose main activity is food retail and whose income is already above the limit. Since the wording “trader” is used by the two ministries in the announcement, based on this, the decree may also cover individual entrepreneurs, where clarification may be necessary, because even small, self-owned bakeries or greengrocers may fall into the scope of those affected.
If it only applies to companies and the latter group is excluded, we can still talk about 290 affected economic operators whose main activity is food retailing.
In the same way, it is not clear from the announcement whether the government considers the food retail TEÁOR code as a main activity, or if it is only included in the scope of secondary activities.
If all qualities are the considered classification, then we can talk about 2,941 affected economic operators based on OPTEN data.
However, it is expected that the government will make some kind of clarification on this at the beginning of the social consultation, when the draft legislation is also published, because if the TEÁOR code is interpreted freely, then actors such as Mol Nyrt. or some construction companies where it operates under its own ownership would also be affected. buffet.
The biggest novelty, however, is that the mandatory promotion applies not only to stores dealing with physical service, but according to the wording of the two ministries, the scope of the decree also “extends to the parcel delivery trade”. This certainly means home delivery players like Kifli.hu and Wolt Market. But the two most well-known players also have several smaller businesses that may be involved, but here again, the details are lacking so that all players can be searched for in the company databases.
Cover image: Getty Images.
