Shops admit reselling supermarket goods

Over a third of small shop owners are buying goods from supermarkets and reselling it in their stores, a new study reveals.

In the survey by The Grocer, 36% of independent retailers admit to purchasing stock from supermarkets instead of wholesalers.

Due to increasingly low prices on goods from the likes of Tesco, Asda and other supermarket chains, shop owners are increasingly bypassing the traditional cash and carry routes for a quick trip to the local supermarket, the report said.

Retailers said that frequent buy-one-get-one-free and multi-pack offers present great value on items such as branded crisps, alcohol and biscuits.

Competition campaigners seized on the poll as evidence of supermarkets’ disproportionate power in the marketplace.

“This is further evidence of the uneven market power supermarkets have,” said James Lowman, from the the Association of Convenience Stores (ACS).

“Their buying power is distorting the market and undermining the traditional supply routes from distributor to retailer.”

The news follows testimony from Office of Fair Trading (OFT) chief John Fingleton last week which suggested the agency is in no hurry to put clamp down on the grocery giants.

The OFT is in the business of protecting competition, Fingleton told a committee of MPs investigating the state of Britain’s high streets, not individual competitors.

Fingleton said that often many, smaller high-street shops suffer not because of the presence of a large supermarket but because of their own inability to connect with consumers.

The ACS has appealed an OFT decision not to launch an inquiry into supermarket practices. The OFT is reviewing the decision and is expected to deliver a report next spring.