After a bit more toing and froing, the Office of Fair Trading finally made the right decision and we are now embarked upon a Competition Commission inquiry into the grocery market that could last up to two years. For starters, the Eastbourne office produced an initial submission on behalf of the wholesale industry earlier this month. However, there is a lot more work to come and FWD will be actively engaged on its own behalf, and working with others, to provide more evidence.
The inquiry process is likely to involve an initial period of high activity for about six months while the CC is fact gathering. Then there will be a comparatively quiet period while they digest the information, and subsequently a further period of asking more questions. After that it will be up to the inquiry team the CC has appointed to work out what is wrong with the grocery market and come up with the remedies to put it right.
FWD is collaborating with like-minded organisations which believe the supermarket juggernaut must be stopped – particularly in regard to abuse of buyer power and predatory incursions into the c-store market. To this end, a meeting between representatives of the Council of the Federation of Wholesale Distributors and the board of the Association of Convenience Stores took place in London in mid-May.
The cost of mounting a campaign to provide evidence for the CC and counter the arguments of the ‘Big Four’ supermarkets will not come cheap. Thus, the purpose of the meeting was to ratify FWD’s agreement to contribute a significant amount of money to a trust fund, instigated by ACS, which will fund the costs of this activity through to the conclusion of the inquiry. Called the Community Shops Campaign Trust, trustees will include three members of the ACS board and four others, including FWD, from the contributing organisations.
On another regulatory front, FWD has already won. After many months the Department for Environment Food and Rural Affairs (DEFRA) informed us that wholesalers storing packaged and labelled organic products will not now be required to be registered and inspected by an organic certifier.
Amendments to the Organic Products Regulations last summer would have meant that wholesalers selling organic products needed to be registered and inspected, at significant cost. But retailers fell outside the scope of the regulations. As a result of the FWD lobby, the minister concerned has applied some common sense, to the issue and a “Further Notes” document, amending the legislation and detailing the wholesaler exemption, has now been issued.