Congress urged by NGA to investigate Big Grocery

Independent grocers demand antitrust investigation into Big Grocery

The National Grocers Association (NGA), the trade association representing the independent supermarket industry, has urged Congress to initiative Big Grocery for alleged anti-competitive tactics.

The NGA said lawmakers should look into how big box stores and e-commerce giants have used their influence during the pandemic to "further disadvantage independent grocery stores and the communities they serve through economic discrimination". NGA released a white paper that can be found here.

“Unfortunately, this is not a new reality in the grocery marketplace for dominant firms to use their buying power to take greater control of the market and demand special treatment from suppliers without an economic justification,” said NGA CEO and President, Greg Ferrara.

“Independent grocers have been feeling the financial squeeze from these anti-competitive tactics for years, and the pandemic has brought these illegal tactics to the kitchen table of every American. As families struggle under the weight of the pandemic, the dominant food retailers are squeezing suppliers and as a result, forcing higher prices and fewer products on independent grocers and their customers."

"Congress has to stand up for local businesses and consumers to demand an end to these harmful tactics and restore a competitive marketplace that benefits the economy and grocery shoppers alike.”

NGA represents more than 1,600 independent grocery retailers who account for nearly 9,000 storefronts across the country, including at least one in every congressional district.

The NGA says these stores compete to offer low prices, higher food quality, better service, more accessible and convenient locations, a greater variety of products, and good jobs.

"But independent grocers have watched over the years as dominant chains ignore antitrust law and abuse their buyer power to demand suppliers provide lower prices and more favorable supply terms, special package offerings and product availability, leaving independent grocers to pay the price," the NGA said.

"In light of the pandemic’s supply chain disruption, NGA members are feeling the heat more than ever. Walmart alone captures one out of every four dollars Americans spend on groceries. Meanwhile, independent grocers are unable to secure many of the must-have products and face supplier prices up to 53 percent higher than what their larger competitors are selling the product for at retail."

"This isn’t just bad for independent grocers; it’s bad for their customers, who are often people of color and people living in rural areas who are forced to pay higher prices or travel farther distances to get the staples they need."

It said that from 2005 to 2015, the number of independent grocery stores available in rural and minority communities has increased, while access to big chain stores has decreased.

Dominant food retailers are also harming small and mid-sized farmers and ranchers, who are paid prices far below competitive levels, the NGA said.

It added: "Demands for lower costs by large chains are forcing consolidation amongst food manufacturers. Farmers and ranchers then are forced to accept unfavorable economic terms, conditions, and prices imposed by the largest members of a consolidated supply chain".

"That means rural residents that rely on the agriculture economy face a double whammy – lower prices at the farmgate and higher prices in the grocery aisle."