Supermarkets let off hook over loss-leading

By James Wilmore

- Last updated on GMT

Related tags: Supermarket, Competition commission

The Competition Commission has let supermarkets off the hook over their deep discounting of alcohol. In the commission's provisional findings report,...

The Competition Commission has let supermarkets off the hook over their deep discounting of alcohol.

In the commission's provisional findings report, published today, it says: "Below-cost selling by national retailers is not part of a predatory strategy aimed at convenience stores or specialist stores and is not having significant unintended effects on smaller stores."

The inquiry has looked into whether the working practices of the big four supermarkets restrict competition across all goods categories.

The issue of supermarkets selling alcohol as a loss leader has long been a concern for the pub trade and today's announcement will be a blow to those eager for a clampdown.

The Federation of Small Businesses (FSB) has hit out at the findings, saying they "miss the point entirely".

"Small retailers and suppliers are being squeezed out because of practices such as selling items below the cost of production, bullying suppliers and increased parking charges in the high street compared to free parking at supermarkets," said Matthew Knowles, spokesman for the FSB.

"Once again the shopping public as well as small retailers and suppliers have been let down by the Competition Commission, who seem unable to see past the huge lobbying resources of the Big Four supermarkets."

In addition, the report also recommends a change in planning laws to allow more supermarkets to be built in areas where there is not enough competition.

Related topics: Beer

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