James Warren
MERCADONA has recorded losses of nearly 95% in March, it claims are due the coronavirus crisis.
The supermarket giant insists the slump is due to a 25% increase in costs, including for logistics, PPE (personal protective equipment) and ensuring the care and security of its staff.
It comes as many regular shoppers at the supermarket insist that prices have not only gone up but that the chain also appears to be doing far better than most other businesses, including supermarkets.
However, Mercadona claims to have spent millions on installing checkout screens in all of its 1,634 stores, as well as introducing hand sanitiser units and issuing PPE to all of its staff and employed external security guards.
In addition, at the beginning of March, the company invested €44 million to give its staff a 20% pay increase to compensate them for their extra effort and risk in continuing to work during the pandemic.
It also hired an extra 600 new personnel to combat the panic-buying that characterised the start of the lockdown and to ensure the smooth running of its stores.
All these measures were estimated to have cost the company an extra €100 million, almost 25% more than the same period last year.
According to the company, a total of €15 million was spent on disinfection and a further €60 million on adapting the stores.
The massive investment has all but cancelled out the 14% increase in sales in March due to consumers purchasing extra items for their home.
Industry experts added that although consumer buying during March increased, many of the items that were targeted were basic, low margin items such as cleaning products and toilet rolls.
The Olive Press has attempted to verify these claims this week, finding that many items appear to have gone up in price at Mercadona in recent weeks.
In particular, meat has gone up in price, as have other luxury items, such as smoked salmon.
One local estate agent, Adam Neale, from Terra Meridiana in Estepona poured doubt on the claims.
He said: “I find it hard to believe that with everyone locked down and spending more money than ever on luxury ingredients at supermarkets that this can be true.
“On top of that, as it is not a public company it is very hard to verify.”
There is a Mercadona in Arriondas in Parres, Asturias, 4 kms from Cangas de Onis in the adjacent council. Mercadona originally wanted to open in Cangas, but they were denied water service by the Cangas council, so opened in nearby Arriondas instead. The Guardia Nacional now has begun to give multas to people from Cangas de Onis who shop at at the Arriondas Mercadona. This would appear to be a politically clumsy way of forcing people to support the less well-stocked Asturian-based markets in Cangas instead of the well-stocked Valencian-based Mercadona.
How funny… I know Arriondas, good restaurants there – and pretty sure none use Mercadona for their produce
Jon, the produce is worse in the other two big markets. Mercadona carries cilantro and ginger. When I asked for either in Dia/Arbol or Alimerka, the attendants respond with ‘Que es eso? Sometimes produce is ok at the Sunday market in Cangas, now closed. Asturians are not big on salads. So we are happy to have Mercadona.
Let’s hope Mercadona will survive this crisis and keep on going strong, they are a good company.