The International Olive Foundation (IOF) has submitted a complaint to the Schweizerischen Lauterkeitskommission (Swiss Fairness Commission) over Lidl's pricing strategy for its Primadonna olive oil.
In a statement, the IOF said that the discounter's current marketing message on Swiss media channels is that it is 'offering sustainable products at fair prices'.
Raw Material Prices
However, the positioning of Primadonna extra virgin olive oil for CHF 4.29 per litre contradicts this, the IOF said, with the 'price of the raw material [...] well below the limit at which we can assume that it guarantees a sustainable olive oil business'.
Lidl sources its Primadonna olive oil in Spain, the IOF continued, adding that over the past week (4 July to 10 July), 41% of the extra virgin olive oil sold on the Spanish POOLred exchange was sold for kilo prices of between €2.17 and €2.28.
If transport, customs, packaging and tax costs are added, the price at which Primadonna oil is on sale in Lidl Switzerland is unsustainable, the IOF has alleged.
Advertising Message
"Is it possible to advertise something like this with a message of 'We focus on sustainable products at fair prices?' No, the IOF has found, and therefore, we have submitted a complaint to the Schweizerischen Lauterkeitskommission," the IOF said in a statement.
The trade association representing Spanish olive oil communities, Aemo, recently stated that with the 'ridiculous' prices currently being advertised across Europe, the production costs incurred by olive growers and olive mills during the 2018/19 harvest cannot be met.
Lidl Response
In response Lidl Switzerland said that it has not yet received an official complaint about this issue.
'It is very important to us to offer our customers the best quality at reasonable prices,' the retailer said. 'We can keep our costs low thanks to our lean internal structures and efficient processes. We pass on these savings to our customers.'
The International Olive Foundation is a Lucerne-based non-profit olive oil testing organisation, independent of the olive oil industry and food retailing industry. Among its responsibilities, the foundation focuses on protecting his quality olive oil standards and protecting olive oil users.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
