MOMENTOUS. This is the critical moment in time when the future of everyone engaged in the cash and carry and delivered industry is in the hands of the chairman of the Competition Commission, lawyer Peter Freeman.
Not only that. The thinking of the CC in its imminent initial report will affect millions of consumers, whose interests he is paid to defend and most of whom are blissfully ignorant of the debate now raging in the chairman’s mind.
Will he decide the low-price strategies on which the Big Four compete is correct in its current form and follow the style of previous regulators who found serious flaws in the market but ignored them?
Or will he turn the market on its head and make way for the introduction of simple fair trading rules which make current abuses of power a thing of the past?
Would you care to take this question with you in your summer holiday baggage?
THIRTEEN. Yes that’s the percentage differential now revealed in the CC market probe after unrelenting pressure from FWD, ACS, NFRN, RSA and other lobbies to get to the reality of giant superstore corporation buying power.
This means that wholesalers – buying the same volumes as one of the giants – could be at a 13% cost price disadvantage when it comes to a deal. This is SHOCKING .
This differential must be enough to persuade the CC that “enough is enough”, the slogan under which FWD maintained its pressure from the late 1990s on the old now departed “regulators”.
Wholesalers have maintained (from the 1970s) that the prices extracted by the giants from suppliers by fair means or foul was not one of the reasons for independents going out of business.
It was THE reason!
VIBES. After years of reading between the lines, Vigilante believes that the summer’s comparative silence of the corporates and their PR departments on the market probe is deafening.
Over lunches at The Savoy, have the leaders of the monster retailers received the word that the game is up? Have you noticed that PR strategies have changed?
“Personality” image building has disappeared, probably on the orders of the boss.
Can you remember the last business page story which defended the big corporates on the grounds that the chairman or chief executive was an ordinary regular guy (a United supporter in the case of Sainsbury’s Justin King, a Brummie, which figures)?
TORYGRAPH. In fact the former Daily Tescograph, which once carried effusive articles warmly reminding Middle England that Sir Terry is an ordinary hard-workin’ Liverpudlian heading up a neo-family Features > Business, may now have a sense of what the CC will say.
Well-connected deputy city editor Richard Fletcher front-paged Sir Terry’s problems with his neighbours on July 23. In his home village of Cuffley, in leafy Hertfordshire, Sir Terry’s fellow residents are disgusted.
The planning application for a Tesco Express in the village, said the paper, was littered with errors and the company had been asked to re-submit the documentation.
This new cool City attitude to Tesco will not be founded on the grounds that the right-wing Telegraph is shedding its capitalist credentials. It’s more to do with the fact that Tesco, as a mega-corporation, has failed to win over the CC and therefore its shareholders will suffer!
INDICATOR. What is new here is the very muted response to Sir Terry’s embarrassment by the Tesco PR department. Previously it has replied aggressively to similar events. After all, we are talking about planning, a highly sensitive subject to which Peter Freeman will certainly bring new regulations.
But the Tesco reply in this case was most demure. It said that its consultants had already spotted their mistakes. At the most critical moment in its history, Tesco appeared to be seeking cover.
Is the company on the ropes? Vigilante is convinced that FWD and allied militants will not come away from the CC review empty handed. Change is in the air.
OGRE. It’s a shame about the shop which Vigilante’s grandmother – on her first shaky visit, hesitantly and stick-aided, peering around an embryo Tesco piled high and selling cheap – declared it the shop of the future,
Are farmers (dairy and wind), tree huggers and other eco-warriors now using the T word to frighten their children into eating their greens?
An “if you don’t eat your cabbage you’ll be taken to Tesco tomorrow” kind of threat.
Temporary holding cells at police stations and Government buildings to ease prison overcrowding have been christened “Tesco cells” – they’ll be everywhere.
ACE. The Guardian covered the opening of the new Manchester superstore which Tesco claims to be a regeneration boost for run-down Failsworth. The store is in an officially Underserved Market in an exercise piloted and by the government.
It’s true the new store has brought jobs to the area, but the story was covered by non other than David Conn, investigative journalist par excellence (and City supporter) who revealed that far from being a “clapped out food desert” there was a giant Morrisons just up the road!
But Tesco has been allowed into a Morrisons patch because the latter sells only food whereas the former sells everything!
Tesco is to sit on a local business forum and has said it will “provide money to help existing small retailers to improve their shop fronts”, David reported. Most intriguing. Is this a new Tesco policy to be implemented everywhere – and is it a message aimed at Peter Freeman?
POTTER. Every columnist must have a Harry Potter story. Here’s one with wholesale associations.
A Torbay independent bookseller could not compete on price with Waterstones. So he bought his new Potter stock from Asda and was then able to participate in the cut price bonanza. There’s a precedent.
In September, 1983, militant independent grocers raided their local superstores to empty the bread shelves and then re-sell the loaves at the same price. Massive national media coverage brought the plight of the small shop to the notice of the Government … it was one small step for mankind.
BARCA. Scottish wholesale legend Eddie Thompson’s dulcet tones wooed Radio 5 listeners prior to the friendly between Dundee United, where he is chairman, and Barcelona.
Eddie, who famously arranged United’s mould-breaking shirt sponsorship by VG in the 1980s, reminded listeners that his club had won Euro-cred by beating Barcelona four times – a record unlikely ever to be broken.
But the Tannadice fans were cruelly denied a result by a lucky Henry goal – his penalty was saved but he scored on follow up. Eddie, please continue to walk tall.