>However that doesn’t work because consumers in Austria don’t realise how they are being ripped off
Oh, they have known for a long time they were being ripped off but didn't have the proof. There's nothing they can do about it because the corrupt politicians claim it's just the free market and can't intervine with the market pricing otherwise it would be communism, and Austrian consumers who don't live close to Germany have no other options for shopping than the local monopoly.
There is evidence that the prices they charge in Austria are often significantly higher than in Germany, meaning higher profits per sale, at the expense of the consumer who's wages are lower than those in Germany, so it's a double whammy.
In the US, many times you cannot compare prices between cities much less states due to differences in land price and costs of city and state taxes/regulations such as minimum wages.
Surely, Austria and Germany, as two different countries, have at least a few big differences in tax systems/labor laws/local laws/etc that can affect cost of goods sold?
The retailers have been questioned regularly why they overcharge in Austria compared to Germany, and they never cited extra wages(lower than Germany FYI), business or tax overhead as the reason, but rather beat it around the bush saying "we're only charging what the market will bare and this is what the Austrian market bares", basically admitting they're screwing you and getting away with it, especially that they often sell stuff made in Austria cheaper in Germany.
I guess that is technically the truth. As a business owner, I also charge the most I think my customer’s were able and willing to pay.
But in all cases I am familiar with (US/Canada/UK/Germany), there are sufficient competing grocery retailers that the price most customers are willing to pay is only a couple percentage points higher than the cost of goods sold.
That does not reflect actual reality. Retailers have answered plenty times why they are charging higher prices in Austria compared to Germany and the arguments are hard to ignore (higher cost of doing business, higher taxes, higher density of super markets, more rural delivery requirements etc.).
Specifically on that point:
> extra wages(lower than Germany FYI)
That is incorrect, the cost of an employee in the grocery space per hours worked is still higher in Austria than Germany, quite meaningfully so.
> There is evidence that the prices they charge in Austria are often significantly higher than in Germany
The cost of doing business in Austria is significantly higher for supermarkets. On the one hand because Austria has many more supermarkets to begin with per chain, secondly because of the high cost of labor in the country. Comparing countries that way is not trivial.
Oh, they have known for a long time they were being ripped off but didn't have the proof. There's nothing they can do about it because the corrupt politicians claim it's just the free market and can't intervine with the market pricing otherwise it would be communism, and Austrian consumers who don't live close to Germany have no other options for shopping than the local monopoly.