True Cost experiments by Penny and Albert Heijn

Making the “true costs” visible

In the sustainability debate, one question is increasingly taking center stage: How can the hidden ecological and social costs of products be measured and communicated? This is precisely where the concept of true cost accounting (TCA) comes in: It supplements business costs with social and ecological external effects that have not previously been taken into account in market prices.

Some European retailers have tested how TCA can work in practice in pilot projects. The best-known initiatives are those by Albert Heijn in the Netherlands and Penny in Germany..

Albert Heijn: True Price in the to-go context

The Dutch supermarket chain Albert Heijn conducted a TCA-based True Price experiment in several of its “To Go” stores. Customers could choose between the regular price and a “true price” for products such as coffee or café drinks. In addition to the retail price, this true price also includes the hidden social and environmental costs of the value chain, such as greenhouse gas emissions, water consumption, raw material use, and working conditions.

The experiment showed that some customers were willing to pay the true price voluntarily, and the project claimed to have contributed to raising awareness of these hidden costs.

Penny: A week on "true costs"

The German discount supermarket chain Penny has also launched a True Cost campaign nationwide: during a pilot period, selected products such as milk, sausage, and mozzarella were sold in its 2,150 German stores for one week at prices that reflected the external environmental costs. This showed that the true costs of many products were significantly higher than the normal retail price when additional environmental impacts were taken into account.

The results of the experiment were evaluated together with a team of scientists led by our founder Dr. Amelie Michalke, among others.

In the Penny campaign, the true costs were displayed directly in the store with an information sticker.

What can be learned from the experiments

Transparent information enables credible sustainability communication that goes beyond mere marketing promises. Both experiments showed that comparing market prices and hidden costs raises customer awareness of externalities.

Consumers are receptive to sustainable price and cost transparency when it is presented in a comprehensible way. For example, the Albert Heijn experiment showed that a substantial proportion of consumers are willing to pay more for more sustainable options.

Building better data bases in one's own value chain is a strategic competitive advantage. This is because the data situation and knowledge about externalities are often still incomplete. Providing this information enables companies to specifically reduce environmental and social costs.

Conclusion: More than just price tags

The True Cost experiments by Penny and Albert Heijn show how True Cost Accounting can be effective in practice beyond pure theory:

• It creates transparency about external effects,

• encourages reflection on product costs,

• and offers companies strategic insights beyond traditional accounting.

For companies that take sustainability seriously, such approaches are not only a tool for disclosure, but also a lever for strategic transformation of the supply chain, product design, and even communication with customers.