"Margins vary by product group — where price competition is fiercest, margins are lowest. We're talking about meat and dairy products, fruits and vegetables," said Prisma's assortment and purchasing director Kaimo Niitaru on Thursday's broadcast of "Terevisioon." "Higher-margin items tend to be long-shelf-life products, basic necessities."

According to Niitaru, prices are most volatile for fruits and vegetables, which are sourced weekly and often fluctuate.

"But generally speaking, pricing decisions aren't made every other day. Everyone monitors each other's moves on the market, collects data and responds accordingly. Single-day changes are very rare. Bagged milk is one of the products retailers are currently selling at a loss to maintain pricing," he said.

Niitaru noted that campaign products now make up 25 percent of Prisma's offerings and the company aims to offer discounts across all product categories.

"Of course, some product groups see more promotional pricing — especially those where regular prices have clearly gone up, like coffee and sweets. Promotional coffee sales are now clearly over 50 percent. But there are also areas where promotional sales aren't as extensive, such as basic necessities or baby products, where much depends on the regular price level," he explained.

Niitaru also said that internal price monitoring of over 20,000 products shows that input prices in August rose 3.6 percent year-on-year excluding the impact of VAT, while actual retail prices increased by 1.5 percent — indicating Prisma has absorbed much of the price increase.

He acknowledged that price inflation is, to some extent, inevitable.

"But we've done everything we can to keep price increases under control. We've been called gatekeepers and all sorts of things, but just to note — so far, I haven't even mentioned VAT. If we said prices rose by 1.5 percent in August excluding VAT, then VAT alone pushed prices up by an average of 1.65 percent. So it's definitely not true that VAT's role is negligible or practically non-existent," Niitaru stressed.

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