Report issued by FTC staff found that national grocery retailers took advantage of pandemic-era supply chain disruptions to cement their dominance over smaller rivals
Washington, D.C. – A day after the Federal Trade Commission (FTC) released its findings that big national grocery chains exploited disruptions in the supply chain caused by the Covid pandemic to solidify their control over the market, exacerbating shortages for consumers and driving up grocery prices, the National Grocers Association (NGA) is calling on key Congressional leaders to push for solutions to level the playing field.
The letter, addressed to Sens. Amy Klobuchar (D-MN) and Mike Lee (R-UT) of the Senate Subcommittee on Competition Policy, Antitrust, and Consumer Rights, and Reps. Thomas Massie (R-KY) and Lou Correa (D-CA) of the House Subcommittee on the Administrative State, Regulatory Reform, and Antitrust, calls for hearings in the short term, followed by meaningful legislative reform.
“The report supports the National Grocers Association’s longstanding assertion that consolidation and buyer power in the grocery sector lead to discriminatory practices against independent grocers, resulting in elevated prices and diminished choices for consumers. Notably, the report reveals how major national grocers capitalized on supply chain disruptions during the pandemic to solidify their market dominance to the detriment of competition and consumer welfare. These findings necessitate further investigation and consideration of legislative remedies to foster a fairer marketplace in the U.S. supermarket sector,” wrote Chris Jones, NGA Chief Government Relations Officer and Counsel.
One of the report’s eye-opening findings is how major chains penalized suppliers that didn’t deliver on time during the pandemic, ensuring that their own stores would be stocked while the shelves of smaller competitors were barren.
“To gain access to scarce products and therefore a competitive advantage, some companies—most often larger ones—used policies that imposed strict delivery requirements on their upstream suppliers and threatened fines for noncompliance,” said the report, titled Feeding America in a Time of Crisis. “Walmart even tightened the delivery requirements its suppliers had to meet to avoid fines as the pandemic went on.”
Click here to view NGA’s letter.
About NGA
NGA is the national trade association representing the retail and wholesale community grocers that comprise the independent sector of the food distribution industry. An independent retailer is a privately owned or controlled food retail company operating a variety of formats. The independent grocery sector is accountable for about 1.2 percent of the nation’s overall economy and is responsible for generating more than $250 billion in sales, 1.1 million jobs, $39 billion in wages and $36 billion in taxes. NGA members include retail and wholesale grocers located in every congressional district across the country, as well as state grocers’ associations, manufacturers and service suppliers. For more information about NGA, visit www.nationalgrocers.org.
