06 May 2008


Print	Email

Small shops need more supermarkets like a hole in the head

Indpendent

Competition Commission

The final report from the Competition Commission's grocery inquiry ignores the plight of small shops, argues Colin Finch, president of the National Federation of Retail Newsagents (NFRN).

The decline of small shops, small suppliers and small farmers is clearly not a concern for the Competition Commission.

All we can expect now is even more clone towns with more supermarkets being built next to one another.

Wherever there is a Tesco or an Asda there will now be a Morrison or Sainsbury coming along. The findings may have inhibited the growth of Tesco but it is liberating the other big chains.

Small shopkeepers need more supermarkets like a hole in the head.

All the evidence submitted by independent retailer associations appears to have been ignored, along with important case studies.

Competition Commission Chairman Peter Freeman is doing to small independent retailers what Dr Beeching did to the railways in the 1960s.

Also disappointing is the fact that the focus of the inquiry changed from one looking at the grocery dominance of the convenience sector into an inquiry of the grocery market as a whole.

It appears that this will be last inquiry into the grocery market, yet there has still been no concentration on the convenience sector, which was what was originally requested.

And the NFRN is equally concerned that key national issues of sustainability in general, and the Sustainable Communities Act in particular, have been ignored.

While the appointment of an ombudsman is to be welcomed, we remain concerned that the remit did not go far enough.

This good intention is ruined by the fact that inquiries can only be initiated as a result of supplier complaints. The ombudsman should be investigating the market as a matter of routine, not waiting for complaints to come in.

We were also surprised at the CC's decision to start the inquiry afresh and disregard its previous decisions. The CC seems unable to grasp the role that its own past merger policy has played in getting us where we are today.

We used to have many high street retailers – most of which were happy to sell packaged groceries – but now we are down to the dominant big four.

The CC allowed Morrison's to buy Safeway, giving it some unexpected monopoly stores. Now it wants these stores to have large, powerful new rivals as it seems to feel that only large, land-hungry, car-based stores can offer real choice to consumers.

Take the tiny town of Huntly in the north-east of Scotland, now surrounded by several large stores.

This urban tragedy is seen by the CC as a good example of how tiny towns can take ever more large stores.

Small towns outside Scotland should be very afraid indeed since both the CC and government do not like the “need” test.

The NFRN remains keen to work with other independent retail associations to see if further action can be taken against the CC's findings.

Colin Finch

Email this to a friend