Local Shops Voice Concerns Over Commission’s Findings

Contesting the conclusion that supermarkets do not affect independents

In their report published last month, the Competition Commission claimed that supermarkets do not damage small stores as much as was previously thought, and perhaps not at all.

However, voice of the local shopkeeper, Association of Convenience Stores (ACS), strongly disagrees and has published its response to the Commission’s Provisional Findings Report.

In their submission ACS has provided the Commission with further evidence to prove that we are witnessing a sustained decline in the number of successful independent traders and local stores in London.

This new evidence has been provided by confidential sources made up of suppliers, wholesalers and market analysts.

The submission has also;

• re-iterated concerns over the way the Competition Commission (CC) has neglected to properly evaluate the impact of below cost selling on groceries and related products including fuel;
• re-iterated the importance of buying price differentials to supermarket buying power and competition.
• outlined the competition problems caused by the entry of major multiples into the convenience store sector;
• re-emphasised the waterbed effect theory and considered weaknesses in the CC’s analysis thereof/ of it;

Chief Executive James Lowman said, “It is a great shame that, several months after we explained clearly why the Commission’s analysis of store numbers in our sector was flawed, we are once again rehearsing these arguments. The latest data used by the Commission, from the Office of National Statistics, is as unreliable as the Experian-Goad database the Commission has erroneously given credence to up until this point.

“We have presented new data from suppliers, wholesalers and independent market analysts to show the decline in our sector, and we believe the Commission will listen to this new evidence and come to a more realistic view on store numbers in its final report.

“What the Commission should really be doing is looking at why these stores are closing down and what impact that has on competition. We contend that some of the pricing activity of the major multiples is predatory, and that the loss of independent stores leads to a decline in choice and particularly harms less mobile consumers.”

ACS is to have its third formal hearing with the Commission on 12 December.

December 5, 2007