The Office of Fair Trading in the UK has announced that it is to refer to market for the supply of groceries, including newsagent lines, to the UK Competition Commission. Any independent analysis of the power of major chains has to be welcomed by small business. (I just wish we could achieve similar traction here with the ACCC and the Productivity Commission.) The OFT announcement, in part, observed:
There is also some evidence to suggest that the big supermarkets’ buyer power has increased, and that there are aspects of the big supermarkets’ pricing behaviour – below-cost selling and price flexing – which could distort competition. Although consumers have benefited from lower prices, the data does not allow the OFT to reach a firm conclusion on whether choice and variety for consumers in local markets – whether choice of fascia or on-shelf product variety – have increased. Because pricing practices and buyer power interact with local concentration to affect product variety and choice of fascia, the OFT proposes also to refer to these features in making the reference.
The OFT could have been writing about Australia.