Thursday, 6 January 2011

Big four supermarkets are expanding at an alarming rate

Recent research says the big four supermarkets (Tesco, Sainsbury's, Asda and Morrisons) are expanding at an alarming rate.

In the last two years, planning authorities have granted permission for at least 480 new supermarket stores in England. It is argued that this will give more choice to local shoppers – but will it? Unfortunately, many councils are persuaded to give planning permission, because of the financial benefit to themselves. Often an agreement is made, whereby the store has to build a community resource, or provide funds for such a venture, in order to gain planning permission to build a store. Thus the council does not have to pay for such facilities. In this age of recession councils will be even more tempted.

John Walker, national chairman for the Federation of Small Businesses, said the number of stores which had opened in the UK in two years was "a concern", especially when almost 12,000 independent shops closed their doors in 2009.

Supermarkets can attract many shoppers with the lure of lower prices (and even more so in a recession). Local traders cannot compete with such huge organisations, which buy in vast bulk at cheap prices. Therefore it leads to forced closure, which, in turn, leads to less choice and variety in an area. The independent High Street shop has been a feature of villages, towns and cities for generations and helps to form the character of an area. Napoleon called us a nation of shopkeepers, in a derogatory way, but, surely, the small trader is a tribute to British enterprise and individuality.

The closure of any small shop leaves our High Streets depleted and, eventually, leads to a loss of identity. 12,000 independent shops went out of business last year.

In their search for ever more cheaper products, the Big Four seem to have scant regard for many concerns.

The farmer who cannot afford to accept the wholesale price offered by the supermarket goes out of business. Question marks hang over the sources of some of the clothing offered so cheaply by the Big Four

And what of quality? Cheapness and quantity triumph here. Mass-produced food, using vast quantities of chemical fertilisers and pesticides is often tasteless when compared to organic produce, or that produced by the local allotment-holder. The effects of imbibing the residues of these chemicals have yet to be seen. And standardisation has reduced variety (take apples and potatoes, for example).

And what of animal welfare? The generality of people have demonstrated their abhorrence of intensive farming methods with their boycott of the battery-produced egg (at least Sainsbury's has banned these).

Yet, I do not doubt that the Big Four will buy milk from the huge factory dairy being proposed in Leicestershire – if it gets planning permission. Like battery chickens, these cows will spend their whole lives inside huge sheds, never placing their feet on a green field. The entrepreneur behind this enterprise has the effrontery to state on television that cows don't belong in fields anymore! It's like a Victorian factory-owner stating: 'Workers (i.e. men, women and children) don't belong in villages anymore!' And, of course, the small dairy farmer will not be able to compete and will go out of business.

Tesco made £3.4 billion profit last year. It cannot possibly make such a profit on its cheaper ranges, which suggests its customers are paying over the odds on other items. But, once in a supermarket, most people will buy everything there. After all, it's so convenient!!!

hattip Vowles



Dear Adrian

Why are you (as a Green) so opposed to cheaper goods, greater choice and better parking?

To quote you “the small trader is a tribute to British enterprise and individuality” – not if they’re overpriced, have a limited stock and run dirty premises.

It’s a fallacy that the small local shop should be treasured as some sort of time honored keep sake when the vast majority of them are expensive, offer poor service and typically are now owned by foreign people anyway – i.e. not the rose tinted image of Mr Waite and Mr Rose you like to think of.

A well stocked Morrisons such as Basingstoke Road offers more choice than a butchers, a bakers, a grocers and candlestick makers combined.

I’d be careful coming out with statements along the lines of “Mass-produced food, using vast quantities of chemical fertilisers and pesticides” if I were you as you’re wrong and therefore libelous.

The supermarket chains would not build stores if they didn’t think the market was there for them.

Adrian Windisch said...

Thanks for trying to save me from being sued Gideon. That statement was a quote from somone else (i gave a link but maybe not quote marks). I doubt they woyld sue me as it seems fair comment to me.

Small shops and big shops will vary in quality. The point is that over a few years we are seening the small shops decline while vast empires take over. Im with the small ones. Not all but many are family run and they get to know the customer.

If things keep going we will have no choice left. So stop the big supermarkets, use the little shops or risk loosing them.

Ken said...

So why do customers go into these stores if they are so bad and why do farmers continue to do business with them?

Adrian Windisch said...

Farmers have little choice, the big 4 dominate the market. If u have your way we will all then have no choice, there will only be one shop.

Most people agree the monopolies comission is there to protect us from one company dominating. Unfortunately the big companies have more influence than they should and the comission has been powerless.

Ken said...

The way I see it, farmers are offered high volume by supermarkets with a potential big expansion of their business. Some say yes but, as I know for a fact, some say no. It really is a choice for them to make. Some prefer the quiet life and prefer to tick over supplying wholesale markets, small retailers & restaurants etc. Others go for the volume.

Adrian Windisch said...

Unfortunately i dont think its so simple. The big players like tesco use their huge influence to pressureise farmers, even quite big ones. I shall try a link for you later

weggis said...

Interesting discussion. There is a structural issue here, which means that supermarkets are not as cheap as you might think. We actually pay more in other [disguised] ways for our convenience goods. I've made a note to write about this when I have time.