The economist highlights that Tine Meiierier, which is wholly owned by the farmers, has a monopoly on butter. – It does not surprise me that the industry takes advantage of the situation, he says. ![]() Gaasland believes that the explanation for increased butter crises in Norway can also lie elsewhere. In light of the war, the energy crisis and cost increases for input factors in agriculture, butter prices have risen internationally. In the wake of the outbreak of war, Indonesia, the world’s largest producer of palm oil, temporarily suspended exports. Both Ukraine and Russia are very important producers of sunflower seeds, which are used to extract sunflower oil. The war in Ukraine sent the prices of, among other things, vegetable oils skyrocketing. The stores profit from selling shopping baskets, not individual items, says Gaasland. – Viewed in isolation, this does not seem logical, but the explanation is that the shops set the prices strategically and dynamically based on competition, and to entice people to the shop. Nettavisen’s price test shows, for example, that Norvegia has gone up by 20 per cent, while Gudbrandsdal cheese has become three kroner cheaper. The figures from September will be available in October. The figures are based on a representative selection of prices from Norwegian grocery stores, and measure the price change from July and August last year, to the corresponding period this year. Gaasland emphasizes that figures from Statistics Norway show that butter has risen by 17 and 21.6 per cent respectively since last year. The price test is a good example of strategic pricing, he says to Nettavisen. – The stores charge as high a price as the competition allows them to. ![]() We have asked Ivar Gaasland, social economist and associate professor at BI, to explain the enormous price increase. The chains are Oda’s competitors in the low-price segment. Kiwi, Extra and Rema 1000 have also raised prices accordingly for Grandiosa, butter, cooked ham and Norvegia. Read the full price test further down in the case. 20 percent increase on the Norvegia slice.40 percent price increase on Grandiosa pizza and liver paste.The price comparison shows, among other things: The prices have been checked at Oda, the low-price online chain. Handle uncertainty Uncertainty in operations’ time and outcome can be easily represented in simulation models, which allows you to measure risk and find more robust solutions.(Nettavisen) A price comparison of 27 items from September last year to September this year shows price increases of up to 40 per cent on individual items.Increased accuracy A simulation model can capture much more details than an analytical model, which provides for increased accuracy and more precise forecast.E.g., you can check warehouse storage space utilization at any given date. Insight into dynamics Unlike spreadsheet- or solver-based analytics, simulation modeling allows observation of system behavior over time at any level of detail.Visualization Simulation models can be animated in 2D/3D, allowing concepts and ideas to be more easily verified, communicated, and understood.Save money and time Virtual experiments with simulation models are less expensive and take less time than experiments with real assets.Make the right decision before making real-world changes. Risk-free environment Simulation modeling provides a safe way to test and explore different “what-if” scenarios.
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