Competition in the UK Grocery Trades

Abstract

In March 1988 the Today newspaper carried the story that the five largest grocery chains had colluded over the retail price of baked beans. It raised the issue of possible use of monopoly power in retailing. The alleged collusion followed an investigation by a trade newspaper representing smaller business. The Independent Grocer (25 March 1988), reported that a tin of Heinz 450g baked beans was priced at 25 pence in stores belonging to the five leading grocery multiples. This, the newspaper stated, was 4 pence more than the price charged two months earlier, a rise of 20 per cent. The increase in the retail price could not be attributed to an increase in the price charged by the supplier. There was no cost-induced need to put the price up; retailers margins were not being squeezed.KeywordsFair TradingLarge StoreMonopoly PowerMonopoly RentMonopoly ProfitThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.