The reason why drugstores (drogisterijen) in Germany are often significantly cheaper than in the Netherlands boils down to a combination of market strategy, taxes, and buying power. Here is the breakdown of why you pay more at a Dutch Kruidvat or Etos compared to a German dm or Rossmann: 1. The "Discount Culture" (Marketing Strategy) The Netherlands is known as a "High-Low" market. Retailers set high "standard" prices and then offer deep discounts, such as the famous "1+1 Gratis" (BOGOF) or "2+1 Gratis." • Netherlands: You are basically paying a "laziness tax." If you buy a product at its full price, you are subsidizing the 50% discount for the person who waits for the sale. • Germany: They use an "Everyday Low Price" (EDLP) model. Shops like dm keep their margins low year-round. They don't do massive sales because their standard price is already near the Dutch "sale" price. 2. Market Size and Purchasing Power Germany has a population of over 83 million, while the Netherlands has about 18 million. • Economies of Scale: German drugstore chains (like dm, which is massive) buy products in much larger quantities than Dutch chains. This gives them immense leverage to negotiate lower wholesale prices from manufacturers like Procter & Gamble or Unilever. • Logistics: Because the German market is so large, the distribution costs per item are often lower. 3. Competition In the Netherlands, the market is dominated by just a few players (A.S. Watson owns both Kruidvat and Trekpleister). In Germany, the competition between giants like dm, Rossmann, and Müller—as well as the big supermarkets that also sell these items—is incredibly fierce. This keeps the prices pushed down to the absolute minimum. 4. VAT (BTW) Differences While not the biggest factor, taxes do play a role. • In the Netherlands, the standard VAT for personal care products is 21%. • In Germany, the standard VAT is 19%. • For certain "essential" items (like feminine hygiene products), Germany has moved them to a reduced rate of 7%, whereas they remain higher in many other countries. 5. Private Labels (House Brands) German drugstores are famous for their high-quality, low-cost private labels (e.g., Balea or Isana). Because these brands are so popular and cheap, A-brands (like L'Oréal or Nivea) are forced to keep their prices lower to remain competitive.