The household basket had a stabilizing effect on laundry detergent prices, but only for the products included in it.

This results from the mapping carried out by the Competition Commission, on the conditions of competition in the laundry detergent market.

In addition, in relation to prices, it appears that the branded products (powder – liquids) that were not included in the consumer’s basket presented, during the period under review, the greatest increase in the weighted price of the measuring cup. In particular, during the period under review (February 2022 – February 2023) the average price per meter for branded powder and liquid detergents that were not included in the consumer’s basket, increased by 16%.

Furthermore, it is noted that after the start of the household basket, the private label products that were included in it showed a small drop in price, while the price of products that leave the household basket increases and, at the same time, it is highlighted that the washing machine tablets were not included in the household basket, they are more expensive than other laundry detergents and have shown an upward trend and strong fluctuations in price.

Finally, in terms of consumption habits, there is no change since the introduction of the household basket, however, there is a relative shift of consumers from private label products outside the household basket to private label products inside the household basket.

The mapping

In detail, the committee’s announcement states the following regarding the mapping of competitive conditions in the washing machine detergent market, based on the provisions of Law 4886/2022 (article 14 par. 2 para. s):

Summary of results

The Competition Commission by its decision, February 8, 2023 (based on the provisions of Law 4886/2022 (article 14 par. 2 para. s.), decided to conduct a mapping of the conditions of competition in the markets of the products: (a) washing machine detergents, (b) fresh whole milk, (c) infant formula, (d) cheese and (e) cow’s yoghurt.

According to article 14 par. 2 para. s., “the Competition Commission…proceeds to map the conditions of competition, in all markets or all sectors of the economy, when this is required for the effective exercise of its powers.

The purpose of mapping the specific products is to deepen the committee’s research, which began in a range of products following the establishment of a supermarket task force with the sector research on consumer staples, published in March 2021, taking into account the latest developments in the market due to significant price increases in certain product categories, changes in consumer habits, and measures adopted by the state.

The mappings enable the Competition Commission to investigate, in a relatively short time frame, issues mainly of market structure and structure that are raised in the markets under consideration, and to better target its potential ex officio investigations, or other types of intervention in the relevant markets. These mappings are part of the Competition Commission’s activities in terms of accuracy but also to increase the effectiveness of its investigations to detect possible anti-competitive practices in products that concern consumers.

The objectives of the mapping of laundry detergents were: a) evolution of shares of the 11 largest supermarkets (SM) and shares in the sales of the 11 SM of suppliers (private label and branded products), i.e. in the market of significant power (upstream market) b) Effect of the household basket mechanism (HB) on the prices of branded and private label products and c) change in consumer buying habits, comparison between branded and private label products.

As part of the mapping of laundry detergents, questionnaires were sent by the general Directorate of Competition to 11 retailers (supermarkets) active in the above markets. The period for which data was received is 1/2/2022-1/2/2023. No other distribution channels were considered.

In particular, the following are noted:

In the period 1/2/2022-1/2/2023 examined by the committee, liquid detergents made up 61% of sales, powder detergents made up 24% of the market and tablet detergents made up 15% of purchase.

Regarding the breakdown of sales between private label products (Private Label) and branded products (Branded), it is noted that in the total value of sales, 92% concerns branded products and 8% private label products, while based on the sold quantity 84% refers to branded products and 16% to private label products. This is because private label products have a lower final selling price.

In terms of sales shares:

* In terms of supermarkets, there is no company that presents a market share of more than 40%.

* In terms of suppliers, there is no company with a share of more than 40%.

* Overall, it is observed that the sales shares (in terms of value) of all 11 supermarkets did not change significantly during the period under review and it seems that they were not affected by the implementation of the household basket (KN). From the suppliers’ side, however, there were fluctuations in their sales from the 11 supermarkets, mainly among the large suppliers of branded products.

Regarding the evolution of prices:

* Regarding the evolution of prices (weighted average price of a measure before VAT) it is noted that, in private label detergents the prices (average price of a measure) fluctuated at a lower level compared to branded detergents and showed a marginal upward trend during the considered period of February 2022 – February 2023.

* Overall the CN had a stabilizing effect on prices only for the products that joined the CN.

* Branded products (powder – liquids) that were not included in the CN showed, during the period under review, the largest increase in the weighted price of the measure. In particular, during the period under review, the average price of the measuring cup for branded powder and liquid detergents that were not included in the CN increased by 16%.

* After the start of the CN, the private label products that were included in the basket showed a small price drop. Based on the analysis with fixed effects regression with panel data, where the product is defined as the combination of SM and barcode and the time variable is defined as day/day, the log normalized price of the products entering the CN is reduced by an average of 8, 27%, while the price (log normalized price) of the products leaving the CN increases more, i.e. on average by 8.69%.

* Laundry tablets were not included in the CN, they are more expensive than other laundry detergents and showed an upward trend and sharp fluctuations in price during the period under review February 2022-February 2023.

In terms of purchasing habits:

* Between February 2022 and February 2023 there is no change in the sales structure (in terms of volume) in detergents in terms of sales of branded and private label products. At the beginning and end of the period under review the ratio was private label: 16%, branded products: 84%.

* Consumers have not switched from branded products to private label products since the start of the KN as there is only a marginal increase in the percentage of sales of private label products, from 15.3% three weeks before the full operation of the KN, to 15.6 % last available period.

* It is also noted that the percentage of sales of products included in the basket did not increase, but remained at levels below 8.5% throughout the period under review, with products outside the basket representing over 90% of sales ( in volume). That is, it is observed that there is no change in consumer preferences from the start of the household basket between branded and private label products. On the contrary, there is a shift of consumers from non-CN private label products to intra-CN private label products, where the total percentage of private label products was divided between in-basket and out-of-basket products.

* Also, a small percentage of consumers preferred branded products introduced in the CN (from 0.5% at the beginning of the period to 0.8% at the end of the period).

* There is a relative shift of consumers from non-CN private label products to intra-CN private label products, where the total percentage of private label products was divided between in-basket and out-of-basket products.

* Finally, there is no change in consumer preferences since the start of the PN.