“The overriding failing of this inquiry is that the commission views competition in the grocery market as competition between the big four retailers.
“This approach ignores the critical need for a variety of retailers and supply chains. It is out of kilter with consumer trends towards more local shopping, and neglects the needs of many groups of consumers whose requirements are not properly met by the big four superstores.”
The ACS claims the Competition Commission has uncovered evidence that shows the anti-competitive effects of supermarket buyer power but has chosen not to take action.
It claims the commission has “ignored significant amounts of below-cost selling and aggressive pricing behaviour, and the alarming trend of consolidation in the number of stores built, and acquired, by an ever smaller number of large companies.”
On planning policy
Lowman said: “ACS supports the commission’s aim to prevent one large company dominating a local market through a planning competition test.
“But the proposal is not strong enough to make a real difference to the so called ‘Tesco Town’ effect. The proposed test applies only to big stores, over 1000sq metres.
“Therefore, in a town dominated by one large supermarket, nothing prevents Sainsbury or Tesco, for example, from opening as many Local, Metro, One Stop or Express stores as they want.
“This is a gaping loophole that undermines the credibility of the commission’s recommendation.
On the retail ombudsman:
Lowman said: “We welcome the commission’s recognition that intervention is needed to stop supermarkets abusing suppliers.
Lowman said: “However, the big problem with the previous code of practice and enforcement was that suppliers were too fearful to complain. It is not clear how the commission’s new proposals will tackle this ‘climate of fear’.
“We are concerned that the commission is far from decisive in setting up the ombudsman. There is much left unresolved in the appointment and funding of the ombudsman.
“We are very concerned that what follows is a long period of legal wrangling that means that no new regulation will be in place for some time to come.
On convenience store numbers
Lowman said: “For the commission to stick to its view that convenience store numbers are increasing is astonishing. The commission was presented with ample evidence from suppliers and wholesalers showing independent convenience store numbers are in decline.
“It is astonishing that after such a long investigation its understanding remains so limited. This failure has undermined the credibility of its recommendations in a number of areas.”
