Everything to lose with these chains

POLEMIC; Tim Lang ponders our growing dependence on supermarkets

Share
Related Topics
Shareholders may have cheered, but the rest of us should be cautious about the hefty profits - £595m - Tesco announced this week. The Tesco figures symbolise what is good (for some) and bad about the British economy - fast concentrating markets mean large companies have too much power, and consumers feeling the squeezehave less choice about where they shop.

Tesco's results put paidto those proponents of Thatcherite market orthodoxy who pronounced that competition from new low-cost, small-range chains such as Aldi and Netto, and US-style warehouse clubs, would be tough for the giants but just what the recession-bound consumer would want. That analysis lies in tatters. Warehouse clubs have failed to take off, and the low-cost chains have not dented the expansion of the biggest British stores.

Britain now has an oligopoly in whichSainsbury, Tesco, Argyll (Safeway), Asda and Gateway or KwikSave (depending on whose figures you accept) account for around 60 per cent of sales. Since 1950 the share of multiples has gone inexorably up, independent small grocers have decreased, and Co- ops show a slight decline.This may be good for the survivors, but it creates neither secure employment nor a sound food economy in which the needs of all are met. Britain now has a food underclass. There are shopping deserts with lots of consumers but precious little provision.

In British law, a monopoly is deemed to be 25 per cent of a market. No one, not even Tesco, which this week claimed to knock Sainsbury off the leadership, has 25 per cent. So what is the problem? There is a sleight of hand here. To Tesco's board, the market is a plastic notion. Having bought a large chain in France and another in Hungary in recent years, it increasingly looks to the European consumer. Sainsbury is quietly mopping up stores on the east coast of the US. Safeway has gone another route, setting up a pan-European purchasing alliance with other large chains. For them, the market is international. But what about the consumer ?

You or I tend to shop within five miles of our homes. That distance has actually risen rapidly in recent years. According to Ministry of Transport figures, the total distance travelled to shop rose by 66 per cent between 1975 and 1991. Henley Centre figures show that 73 per cent of households now use a car for their main grocery shopping. No wonder the time we spend on food shopping has risen in the past 30 years. In other words, we go to work to earn money to buy a car which we use to shop for daily needs. And we are encouraged to be thrilled at the "bargain" of 10p off a pint of milk! This is absurd. And, as last month's redundancies at Northern Foods showed, it also puts people out of work.

For all their trumpeting of slashing prices, supermarkets are very good at raising them, too. The Consumers' Association's routine monitor of prices found a small overall rise in its basket of goods from 1993 to 1994 at a time when there was supposed to be a price squeeze.

One reason for higher prices is the growing proportion of pre-processed foods sold in supermarkets at a premium - we now eat a diet of more than 80 per cent pre-processed foods.

Markets should be defined locally; if bus companies are judged for local competition, why not supermarkets? Last year Tesco bought Scotland's largest chain, Wm Low, surely taking it over the 25 per cent threshold. At a borough or travel-to-shop level, most observers suspect that monopolies already exist. With the Commons Trade and Industry Select Committee about to press for an overhaul of the Office of Fair Trading and the Monopolies and Mergers Commission, where better for them to start than supermarkets?

The writer is professor of food policy at Thames Valley University and co-author, with Hugh Raven, of `Off our Trolley? Food retailing and the hypermarket economy', IPPR, 1995, £5.45.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Opilio Recruitment: QA Automation Engineer

£30k - 38k per year + Benefits: Opilio Recruitment: An award-winning consume...

Opilio Recruitment: UX & Design Specialist

£40k - 45k per year + Benefits: Opilio Recruitment: A fantastic opportunity ...

Opilio Recruitment: Publishing Application Support Analyst

£30k - 35k per year + Benefits: Opilio Recruitment: We’re currently re...

Opilio Recruitment: Digital Marketing Manager

£35k - 45k per year + benefits: Opilio Recruitment: A fantastic opportunity ...

Day In a Page

Read Next
A Pokot woman holds a razor blade after performing a circumcision on four girls  

The campaigns to end FGM are a welcomed step, but they don't go far enough

Charlotte Rachael Proudman
Our political system is fragmented, with disillusioned voters looking to the margins for satisfaction  

Politics of hope needed to avert flight to margins

Liam Fox
Homeless Veterans Christmas Appeal: ‘We give them hope. They come to us when no one else can help’

Christmas Appeal

Meet the charity giving homeless veterans hope – and who they turn to when no one else can help
Should doctors and patients learn to plan humane, happier endings rather than trying to prolong life?

Is it always right to try to prolong life?

Most of us would prefer to die in our own beds, with our families beside us. But, as a GP, Margaret McCartney sees too many end their days in a medicalised battle
Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night - is that what it takes for women to get to the top?

What does it take for women to get to the top?

Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night and told women they had to do more if they wanted to get on
Christmas jumper craze: Inside the UK factory behind this year's multicultural must-have

Knitting pretty: British Christmas Jumpers

Simmy Richman visits Jack Masters, the company behind this year's multicultural must-have
French chefs have launched a campaign to end violence in kitchens - should British restaurants follow suit?

French chefs campaign against bullying

A group of top chefs signed a manifesto against violence in kitchens following the sacking of a chef at a Paris restaurant for scalding his kitchen assistant with a white-hot spoon
Radio 4 to broadcast 10-hour War and Peace on New Year's Day as Controller warns of cuts

Just what you need on a New Year hangover...

Radio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
Cuba set to stage its first US musical in 50 years

Cuba to stage first US musical in 50 years

Claire Allfree finds out if the new production of Rent will hit the right note in Havana
Christmas 2014: 10 best educational toys

Learn and play: 10 best educational toys

Of course you want them to have fun, but even better if they can learn at the same time
Paul Scholes column: I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season

Paul Scholes column

I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season
Lewis Moody column: Stuart Lancaster has made all the right calls – now England must deliver

Lewis Moody: Lancaster has made all the right calls – now England must deliver

So what must the red-rose do differently? They have to take the points on offer 
Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

Sol Campbell cries foul at Labour's mansion tax

The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

Sarkozy returns

The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
Is the criticism of Ed Miliband a coded form of anti-Semitism?

Is the criticism of Miliband anti-Semitic?

Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

Ouija boards are the must-have festive gift

Simon Usborne explores the appeal - and mysteries - of a century-old parlour game