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EXPLAINED: Why cross-border shopping has become less popular in Switzerland

Helena Bachmann in Geneva
Helena Bachmann in Geneva - [email protected] • 11 Nov, 2022 Updated Fri 11 Nov 2022 14:47 CEST
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Former border-hoppers now prefer to shop in Switzerland. Photo by Fabrice COFFRINI / AFP

For years, many people living near one of Switzerland’s borders used to shop in neighbouring countries to save money. But a new study shows this is declining.

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The so-called “retail tourism” has been very popular in Switzerland, as people living in border regions used to fill their cars to the max with products purchased in France, Italy, and Germany, where they were much cheaper.

In fact, Swiss shopping tourists spent around 7 billion francs a year in stores abroad.

While some people still drive across the border to the nearest Carrefour, Kaufland or Conad, many others no longer do so, preferring to shop locally instead.

This is the conclusion of a new long-term study by the University of St. Gallen.

It found that in the past five years, shopping tourism has decreased by 10 percent, with Swiss consumers spending less money across the border.

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There are several reasons for this phenomenon, according to Thomas Rudolph, the university’s director of the research centre for retail management.

One was the Covid pandemic in 2020 and 2021, which stopped people from shopping abroad due to entry restrictions — crossing the border for non-essential reasons, including shopping, was banned during the lockdown.

Another, more recent reason cited by Rudolph is inflation, which is much higher in eurozone countries: currently 6 percent in France, 10.4 percent in Germany, and 11.9 percent in Italy — against 3 percent in Switzerland.

In terms of food, prices increased by 11.8 percent in France, 18.7 percent in Germany, and 16.6 percent in Italy. In Switzerland, meanwhile, food became "only" 4.2 percent more expensive.

READ MORE: How does the cost of living crisis in Switzerland compare to other countries?

These hikes basically wipe out all the potential savings; "those who shop abroad, do so primarily because of the lower prices. But now they are also increasing,"  Rudoplh noted.

One factor that might still motivate shoppers from Switzerland to venture abroad is the favourable franc – euro exchange rate: thanks to the strong Swiss currency, it is still possible get good deals across the border, though not to the same extent as before.

This trend reversal is clearly beneficial for Switzerland’s retail industry, Rudolph said: not only does it boost local economy, but also the "appreciation for local products".

Further information about more affordable shopping options in Switzerland can be found here:

Migros versus Coop: Which Swiss supermarket has cheaper groceries?

Aldi versus Lidl: Which retailer is cheaper in Switzerland?

 

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Helena Bachmann in Geneva 2022/11/11 14:47

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