10 reasons supermarket mergers are bad for consumers, farmers and small businesses

13 January 2003

1. Supermarkets don't offer the best price to consumers. Supermarket low prices are only on a very limited range of goods. A recent survey by Friends of the Earth found that supermarkets are the most expensive place to buy apples, market stalls and greengrocers beat the supermarkets, including Morrisons and Sainsbury's on price. A survey for Sustain in 2000 found that fruit and vegetables were around 30 per cent cheaper at market stalls than supermarkets.

2. Supermarkets favour imports over British produce. Although 84 per cent of shoppers say they want supermarkets to give preference to British produce when it is in season, the supermarkets appear to do the opposite. A Friends of the Earth survey found that at the height of the UK apple season under half of the apples on offer in the big four supermarkets were home-grown.

3. Supermarkets' bullying tactics can put small farmers out of business. The Competition Commission found that the big supermarkets enter into unfair trading practices with their suppliers. For example supermarkets pay invoices very late, and they pass costs back to suppliers for changes to transport and packaging and even for their own mistakes in ordering. Because these practices can hamper suppliers' investment in new products, and makes it hard for smaller businesses to compete, the Competition Commission warned that consumer choice may be effected.

4. Supermarkets are squeezing prices to farmers. Last year the NFU found that for a basket of food costing the consumer £37 the farmers would only have got £11. The Competition Commission found that Tesco which has the biggest market share paid the lowest prices.

5. Supermarkets are forcing small shops out of business. About eight independent shops close every day. Small independent shops cannot compete with the big multiples.

6. Supermarkets do not support the local economy in the same way that local shops do. The New Economics Foundation has found that local shops keep more money circulating in the local economy.

7. When a large supermarket opens there is a net loss of jobs. The British Retail Planning Forum found that every time a large supermarket opens on average 276 jobs are lost.

8. Supermarkets import food over huge distances, often by air, resulting in large emissions of carbon dioxide. For example two kilos of baby carrots from South Africa will travel 9,622 km by plane and result in emissions of 10,969 grammes of global warming carbon dioxide.

9. Supermarkets also transport food large distances around the UK due to their distribution system. For example according to the Institute of Grocery Distribution Sainsbury's vehicles clocked up 15.7 million km last year and Asda/Wal-Mart clocked up 147.9 million.

10. Supermarkets waste food by placing difficult conditions on farmers for cosmetic appearance. In a Friends of the Earth survey it was found that supermarkets frequently reject apple growers' fruit for being the wrong shape size or colour even though it is perfectly edible.
    

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