Lubomir Nokov, Co-founder and CEO at Harmonica Foods, recently posted something that made me stop scrolling. He opened with a simple, uncomfortable question in Bulgarian: 🛒 Защо е скъпа храната в България? and then added that politicians again promise to fight the so called bad retail chains.

In his words, blaming supermarket chains for expensive food is like blaming the cinema because you did not like the film. By the time food reaches the store shelf, its price has already been decided elsewhere, much earlier in the chain.

That short post captured a frustration many people feel but rarely dissect: if everyone keeps talking about greedy supermarkets, why do producer prices keep rising even when energy and fuel go down? And why do new producers struggle to enter the market at all?

In this article I want to unpack and expand on the ideas in Lubomir Nokov s viral post, because they point to a deeper structural problem in Bulgaria s food market and, more broadly, to how competition policy works in smaller economies.

Where Food Prices Are Really Decided

Nokov points to Eurostat data showing that since 2021, prices at the producer level in Bulgaria for basics like milk, bread, oil, meat, and sugar have been growing faster than the EU average. That is before transport, retail margins, or fancy store interiors come into play.

If the price is already high when it leaves the farm or processing plant, it is unrealistic to expect miracles at the supermarket level. Retailers can smooth fluctuations a bit, negotiate, optimize logistics, but they cannot consistently sell at a loss. If they do, they exit the market or quietly raise prices elsewhere.

In other words, the real battleground for affordable food is upstream: in agriculture, processing, and first sale from producers, not at the final retail stage that most voters see.

The Wrong Enemy: Why Blaming Retail Chains Fails

Politically, however, going after retail chains is attractive. As Nokov notes, a fight with the big chains is easy populism. They are visible, easy to personify as villains, and any investigation or price cap looks like quick action on behalf of consumers.

But that focus ignores basic market structure. When there is already limited competition upstream, squeezing retailers often just reshuffles margins rather than lowering final prices. A chain under heavy political and regulatory pressure will protect itself by:

Reducing investment and service quality
Cutting back on smaller or local suppliers, who are seen as riskier
Pushing for longer payment terms that hurt producers
Or simply exiting less profitable regions where people already have few alternatives

The result is a weaker retail ecosystem and even fewer channels for innovative or smaller producers to reach consumers. The public anger finds a target, but the root causes of high prices remain completely intact.

Few Producers, Weak Competition, High Prices

The core of Nokov s argument is not about retailers at all. It is about the sectors where food is produced and processed. He notes that in many of these sectors there are only two or three big players who effectively hold the market.

When a small number of large companies dominate, several things tend to happen:

Prices move in lockstep, even without explicit collusion
Innovation slows, because there is less pressure to improve
Smaller rivals are kept at the margins with worse terms or no access to key infrastructure
Political influence concentrates in the hands of these few players

In such an environment, you do not need an explicit cartel. The simple fact that everyone knows who sets the tone is enough. If you are in a comfortable position with no strong rivals, why would you voluntarily lower prices or accept thinner margins

Nokov adds that this dynamic is not a secret. Analyses from the Commission for Protection of Competition have described similar patterns. The problem is not lack of diagnosis. It is lack of consequences.

Barriers That Keep New Producers Out

One of the most important points in Nokov s post is about barriers to entry. New producers find it hard to enter these markets because of a combination of institutions, rules, permits, inspections, and administrative risk.

On paper, many of these rules exist for good reasons: food safety, environmental standards, consumer protection. In practice, when they are applied inconsistently or slowly, they become a powerful filter that favors incumbents:

Big players have legal departments and lobbyists who can navigate bureaucracy
Smaller producers are far more vulnerable to delays, surprise inspections, and sudden rule changes
Unclear or contradictory regulation makes every investment decision riskier for newcomers

Even when no one openly says you are not welcome, the message is clear: do not rock the boat. And if you do manage to enter, the cost of surviving the administrative gauntlet is so high that your prices cannot be significantly lower than those of incumbents.

This is exactly the opposite of what a healthy market should look like. Institutions should be guarding competition and entrepreneurship, not unintentionally defending the comfort zone of the strongest players.

Why Competition Policy Matters More Than Price Caps

If we follow Nokov s logic to its conclusion, the real policy question is not how to punish supermarkets, but how to unlock competition where it matters most.

That means moving from visible, headline grabbing interventions to slower, more technical work:

Systematically reviewing sectors where a few companies control most of the production or processing
Removing unnecessary administrative barriers that do not clearly improve safety or quality
Making permits, inspections, and regulatory requirements transparent and predictable
Enforcing competition law when incumbents abuse their position to block newcomers

None of this makes for an exciting press conference. But over time, it does something more powerful: it lowers the structural cost of doing business and allows new producers with better efficiency or higher quality to actually reach the market.

And as Nokov insists, if there is no real competition where food is produced and processed, there is no way it will be cheap in the store.

What Could Actually Lower Food Prices in Bulgaria

Building on Nokov s post, here are a few directions that could have real impact on food prices over time:

1. Focus on Producer and Processor Markets

Policy debates and media coverage should include not just retail prices, but also concentration and pricing dynamics in farming and processing. Without transparency there, every conversation about greedy retailers is half blind.

2. Make Entry Easier for New Players

Review sector specific regulations with a simple question in mind: does this rule clearly protect health, environment, or fairness, or does it mainly create paperwork

Where the answer is the latter, simplify. Where the rule is essential, make compliance clear, fast, and predictable so that small and medium producers can invest with confidence.

3. Strengthen and Empower the Competition Authority

If the competition watchdog has already identified problems in specific food sectors, its reports should not disappear into a drawer. There needs to be follow through: remedies, monitoring, and if necessary, sanctions for abuses of dominance.

4. Support Shorter Supply Chains

More direct links between producers and consumers farmers markets, local coops, short supply chains, regional brands do not replace supermarkets, but they create pressure and alternatives. When retailers know that consumers have other options, their bargaining with big suppliers looks very different.

A Better Conversation About Food Prices

Lubomir Nokov s post resonated because it pushed the conversation beyond the easiest target. It reminded us that by the time we see a high price tag in the store, many decisions have already been locked in upstream.

If we truly care about the cost of food in Bulgaria, the task is harder but more meaningful than shouting at retail chains. It is about opening markets that are quietly closed, lowering invisible barriers, and insisting that institutions protect competition and entrepreneurship instead of the comfort of a few dominant players.

That is not as simple as announcing a new war on bad supermarkets. But it is far more likely to make the next grocery bill smaller.

This blog post expands on a viral LinkedIn post by Lubomir Nokov, Co-founder and CEO at Harmonica Foods. View the original LinkedIn post →