Australian Newsagency Blog

A blog on issues affecting Australia's newsagents, media and small business generally.

UK supermarket investigation shows us the way

Mark Fletcher
January 29th, 2007 · No Comments

The UK Competition Commission has issued an interim report, which outlines its “Emerging Thinking” behind its current investigation into the grocery sector. The investigation includes consideration of the supply of newspapers and magazines to supermarkets. The Emerging Thinking document looks at a range of issues often discussed here in Australia in terms of supermarket behaviour: market power, below-cost selling, price flexing and demand withholding.

The UK Office of Fair Trading, which referred the matter to the Competition Commission, claims to have reasonable grounds for suspecting that trading practices with supermarkets restricts competition. These are my words – read the full terms of reference.

The next phase of the investigation is around local trading.

While there is a risk in any investigation, I am certain that Australian Newsagents and other small retailers would welcome a similar investigation here. The conditions are worse than the UK with just two retail giants controlling the grocery, liquor and fuel sectors. Newsagents have a voice at the table in the UK and this is far more valuable than the many words of comfort (and little action) from Australian politicians in our direction for the last decade.

The UK investigation, while a long way from completion, provides UK newsagents and small retailers with information they would otherwise not have known. Some myths are dispelled and others proven to have substance.

Newsagents in Australia ought to work on engaging the Productivity Commission, the ACCC and the Australian Government Competitive Neutrality Complaints Office in research so that we too can better understand the state of play and, maybe, help our politicians make better decisions affecting newsagencies and other small businesses.

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Category: Newsagency challenges

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