Hopes were raised this week that a full market review would result from the All Party Parliamentary Small Shops Group High Street 2015 inquiry.
Representatives from the independent grocery trade, including the Association of Convenience Stores, the Federation of Wholesale Distributors, Musgrave Budgens Londis and Proudfoot Group, were among the first to present evidence to the inquiry.
A large proportion of the evidence centred on Tesco’s increasing dominance of the high street. Chairman of the
group, Labour MP Jim Dowd, is now inviting Sir Terry Leahy to appear at next week’s hearing.
MBL MD Mike Taylor said that he was optimistic that something positive could come out of the inquiry. “The MPs seemed to take this issue very seriously and the chairman made it very clear that action can be taken. Just because the OFT decided there was no need for a market review doesn’t mean it can’t be challenged. Everything in the market shows that decision was incorrect.”
And Ian Proudfoot, joint MD of Proudfoot Group, who presented a first-hand account of Tesco using predatory pricing, added: “The Competition Commission failed to strike while the iron was hot on predatory pricing and make sure it could never be used again. The commission has lost my respect but this inquiry gives us another chance.”
The MPs heard that if the current trend of independent shop closures continued, four out of 10 c-stores would be wiped out in a decade and that abolishing Sunday trading laws would exacerbate the situation.
ACS chief executive David Rae said: “Dominant retailers are able to use predatory pricing and secretive dealings with their suppliers to protect their position. It is no surprise that the increasing level of closure of local shops has coincided with the takeover of a number of convenience store chains by the major multiples.”
And cheaper prices given to multiples by suppliers skewed the market as the differentials were not proportionate to buying power, claimed FWD director general Jim Murphy.
Meanwhile, the National Federation of Retail Newsagents called for the government to appoint a community tzar who would prevent the breakdown of communities through expansion of the multiples.
And the Women’s Institute in Cornwall has voted to boycott supermarkets in favour of small shops. The campaign could go national next year.
Fiona McLelland