Giant stores not the best way to lower prices
The Minister for Enterprise, Trade and Employment, Mary Harney, should consider negotiating with existing supermarkets of a certain size, such as Tesco, Superquinn and Dunnes Stores, to include a discount store of approximately 20% of existing shop floor devoted to all their best offers.
Then a customer on a budget could shop quickly for the goods that he or she required at the best possible price.
The Government's consumer watchdog, the Office of the Director of Consumer Affairs (ODCA), could operate a grocery consumer website for example www.foodpricewatch.ie to inform customers of the best grocery deals available in their area.
Existing supermarket food retailers could be required by law to label their grocery goods with the percentage value added margin that they are charging as a retail mark-up.
Our politicians should examine thoroughly the impact of lifting the cap on supermarket size when it was introduced in Britain.
It had devastating consequences for town centres and it discriminated against the social groups that it was intended to assist, namely the poor.
Out-of-town shopping centres favour car owners at the expense of poorer, non-car owning families and pensioners.
They are also environmentally damaging as customers have to drive an extra few miles and, unfortunately, consumers do not bother to put a price on their time and the car fuel spent on travelling to these massive out-of-town warehouse stores.
In Britain, local authorities granted planning permission to out-of-town shopping centres because of the prospect of increased local taxation in the form of business rates, and ignored the devastating consequences for their own high street retailers.
Some discount storesdo not stock Irish goods and offer no support to local producers and suppliers, and hence the local economy.
A case study in Sacramento in the US provides an interesting perspective on what happens when these warehouse discount stores become monopolies and no longer feel the pressure to behave like discount stores.
The message Mary Harney needs to take on board is that there are other, better alternatives based on retailer transparency and fairness that can achieve lower consumer prices for grocery goods.
Negotiating with the existing Irish-based supermarkets such as Superquinn and Dunne Stores, as well as Tesco, to devote significant shop space to a designated discount section in all stores would be a worthwhile first step.
A further course of action open to the Minister in future would be to introduce an upper limit on the value added margin that could be charged by supermarket food retailers for a range of mainstream grocery goods?
Dermot Mulqueen,
Brighton Square,
Rathgar,
Dublin
