Skip to main content

British Office of Fair Trading to Investigate Sainsbury Deal

LONDON -- Amid warnings that hundreds of community stores are at risk because of the aggressive plans of the "Big Four" supermarkets, the British Office of Fair Trading has decided to investigate the deal by Sainsbury to purchase 114 convenience stores, reported the Evening Standard.

Sainsbury wants to purchase the Jacksons chain in the north of England.

The Association of Convenience Stores said the multi million-dollar expansion of Sainsbury, Tesco, Asda and Morrisons-Safeway into suburban and rural corner shops has gone too far. It demanded a wide-ranging inquiry into the supermarket industry's drive to cash in on the £23 billion-a-year convenience store market. Officials are to meet with Consumer Affairs Minister Gerry Sutcliffe to press their case.

The ACS said small family businesses are being forced to shut down, as they cannot compete with the financial muscle and prices charged by the major names. It is particularly worried about supermarkets selling staple foods, such as bread, at a loss in their community stores.

"The supermarkets are being very aggressive," said ACS CEO David Rae. "Once you get a major supermarket moving in, there is a trend of small independents -- the businesses which give an area its character -- going out of business."

Rae added that there exists a rich heritage of retailing in the United Kingdom, with a mix of general grocery and specialist stores that are now under threat. "In a few years, the only option in certain areas will be different-sized stores of the same retailer. That can only reduce customer choice."
This ad will auto-close in 10 seconds