Footnote: Supermarkets

From Small Beginnings

Once upon a time, the food and general household needs of the population of Britain were provided by thousands of small shops and street markets of various kinds. Gradually, a handful of them in different parts of the country took over the shops that were failing and those belonging to retiring proprietors. As a result, they became a little bit bigger than their peers. And they grew. Eventually they became very big businesses, dominating their communities.

Being large, they were able to buy in bulk. Consequently they were able to demand levels of discount from suppliers. Their remaining smaller peers could not. They were thus able to buy in a permanent buyer's market from their suppliers and to sell in a permanent seller's market to the general public. Their profits spiralled, feeding their ever-growing reserves of capital. Armed with these massive reserves of capital they then set out to conquer the entire retail food market of the United Kingdom.

The Conquest of Britain

The supermarket began to conquer Britain stage by stage. Community by comm­unity. Region by Region. Its strategy was simple.

1. Select a geographic area it did not yet control. That is, one whose popula­tion was still supplied by a variety of small shops.

2. With its millions of pounds worth of capital, build a vast super-store on the perimeter of town with its own free car park and access roads.

3. Stock the new super-store with all manner of attractively presented goods.

4. By operating at a loss, sell these goods at prices well below what the exist­ing local shops could even buy them for.

5. Subsidise the loss from the vast profits being made by stores already estab­lished in other parts of the country.

6. The general public, ignorant of the ploy, flock to the super-store and away from the local shops.

7. All the local shops inevitably go out of business.

The proprietors of the shops that are thus driven out of business then face ruin. Their plans for a comfortable retirement are replaced by the spectre of living out their days on the bread line of 'social security'. The younger dependants of their businesses (who may be younger members of their own families) join the unemp­loyment queue.

Meanwhile, due to their reduced grade of customer service, the super-stores do not need to employ anywhere near as many operatives as the small shops they dis­place. You cannot tell them what you want and have them then go and get the goods you ask for. You have to traipse round their shelving system and get them yourself and then be herded through a checkout like cattle with big brother watch­ing you through a closed circuit television system.

With all the local shops put out of business and their competition thus eliminated, up creep the prices. So, this new branch launches into high profit. The high profits from this — now profitable — super-store are then, in turn, used to finance the initial losses for a further new super-store in yet another unconquered part of the country. This process is repeated until the whole country has been conquered.

Exclusive Control

Of course, if such a monopoly were too obvious, the general public may start to feel very uneasy about it. This could force even a capitalist-oriented government to en­act anti-monopoly legislation. So in order to be seen to be in a competing situation, each super-market company 'welcomes' one or more of its peers to the other side of town. Then they all pretend to play a little Ping-Pong game with the prices of var­ious items they each 'independently' decide to put on special offer.

Having conquered the whole of the country's retail food industry, these supermar­ket chains, between them, control the nation's entire food supply and distribution system. As autonomous limited companies, none of these super-markets is obliged to supply any given individual with food. It is also free to set whatever terms and conditions it likes under which it will and will not supply food. To maintain comp­etitiveness with their peers they all tend to adhere to the same terms and condi­tions of trade and to share information on the perceived creditworthiness of indiv­iduals. Furthermore, since all super-market companies are independent, they are not obliged collectively either to supply food to a particular individual.

This could mean for instance that if they were to decide that customers may only pay by means of the store's own account card, then those who are not for any rea­son able to obtain such a card could not obtain food. Whether due to low in­come, bad money management or even computer error, that person would be un­able to buy food. Although this has not happened yet, nevertheless it could. There­fore, eventually, it will. But sadly, since it would affect only a disadvantaged minor­ity, a social majority of self-interested individualists is unlikely to be moved to do any­thing about it.

The Conquest Diversifies

Having taken possession of the nation's entire food market, this handful of powerful commercial leviathans have set their sights on other market sectors. Super markets now stock books, audio tapes and compact disc (CD) records. While shopping for the weekly food, it is the ideal situation in which to trap the shopper into an im­pulsive purchase of the latest popular book or song. But only the immediately pop­ular titles that will shift stock quickly. None of the connoisseur, specialist, class­ical, obscure or educational items that are made available to the public by genuine booksellers and music shops. Only that narrow popular band of pulp on which a high quick profit can be guaranteed. The same with car accessories. They only car­ry a narrow range of impulsively purchased fast-movers. Not the complete range of items of which the motorist will occasionally have vital need.

The result is that the super-markets are taking away from booksellers, music shops and car accessory shops sales of the narrow fast-moving lines on which they make most of their profit. They cannot survive on the wide range of slower moving lower profit items that go to make up the full range of public needs and demands in their market sector. So, like the small local food shops before them, the specialist sup­pliers are driven out of business and the gullible public is left with a reduced choice of popular products, and unable to obtain certain vital items, which it is not profit­able for the super-markets to carry. This has happened in books, records, car acce­ssories, hardware and petrol. How long before we see own-brand televisions, com­puters, washing machines and cars?

Of course, super-markets carry food and other products manufactured by specialist manufacturers. Some of these specialist manufacturers are very large and univers­ally known companies who advertise through the mass media of television and papers to promote and maintain their high level of sales. But having put the small shops out of business, the super-markets are now the only retail outlets available for the specialist manufacturers. The super-markets are thus able to dictate whose products shall, and whose products shall not, be available to the public.

The super-markets, realising their power in this regard, sell imitations of the large manufacturers' products at prices far lower than those for which they retail the manufacturers' own products. The super-markets' imitations are presented as their own makes. However, they are really made by small specialist manufacturers who are too small to be able to market their products themselves through the mass-media. And unless a product is mass-media marketed, the public will never buy it. The small specialist manufacturers are therefore only too happy to sell their goods exclusively to one super-market chain in return for the most meagre return.

The New Mass-Media

The super markets themselves do not do much mass-media advertising in relation to their size. They don't need to. This is because their super-stores are themselves, in effect, mass-media communications devices in their own right. The mere pres­entation of a product on the shelves of a super-market is a perpetual advertising campaign for that product. With appropriate positioning and in-store promotion, a super-market's 'own-brand' products can get far more and better mass-media ex­po­sure than can any manufacturers' products advertised through conventional mass-media. The result is that the products of the once-dominant big manu­fact­urers have become progressively marginalised in favour of the super-markets' own-brand products. So, like the small local shops before them, the big manu­facturers are in danger of being killed off by the super-markets.

With the large manufacturers marginalised, and the small manufacturers each tot­al­ly dependent on one super-market for its custom, the latter are each ripe for take-over by the super-market they supply. Super-markets have thus come to own farms, food processing firms, haulage firms and all kinds of other specialist opera­tions. However, they don't necessarily opt to buy out their small suppliers. Owner­ship is expensive. It brings with it responsibility. But whether or not they own them literally is immaterial. They have exclusive control over them which, in reality, is posses­sion.

Accountable to Nobody

One or two massive super-market companies are thus well on their way to control­ling the entire consumer market. As a result, all trade between domestic consumer and producer has to be routed through them, thus empowering them to cream off a rich percentage of every transaction or movement of goods between every prod­ucer and domestic consumer. Further, it should be realised that while their con­sumer customers are essentially a home market, the producers from whom they buy are not.

Capitalism is global. Supermarkets are its prime example. They buy from wherever goods are cheapest. If they find a cheaper source of a certain good in some ob­scure Third World country whose dictatorial regime produces it as a cash crop while its people starve, then they will immediately switch their supply from the home supplier to this Third World source. Later, if they find an even cheaper source, then they will switch again. They are concerned solely with short-term profit. Though col­lectively they control the feeding of the nation, they have no social res­ponsibility for ensuring that every individual is supplied with his needs of life. They answer to nobody but themselves.

The Keys To Life & Death

At present, a supermarket's customers are essentially confined to its home nation. However, this is unlikely to remain so. The big supermarket companies of all cap­ital­ist countries are, by nature, expansionists. Their quest is to seek out smaller peers all over the world to buy-out and take over, thus expanding their national cartels into larger global ones.

The supermarkets are not merely big shops, within a free and open market, from whom you may choose, or choose not, to buy your groceries. They are profiteering traffickers who have exclusive control over the supply of our basic needs. The day will surely come when they alone shall stand guard at the door to the Tree of Life. Only he to whom they condescend to grant a Store Card may enter in and live.

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Parent Document | ©September 1995 Robert John Morton