CHARLOTTETOWN, P.E.I. – Grocery pricing policies could be keeping some deals from shoppers, according to Canada’s Competition Bureau.
Consumers often turn to flyers, social media and online promotions before deciding where to buy their food and household supplies. But the bureau says they might not be seeing the lowest price available, because of minimum advertised pricing policies used in the sector.
“That means consumers can’t shop around and won’t know that there might be a better price until they go in-store,” said Jeanne Pratt, interim commissioner of competition. “Given how important food affordability is for everybody these days, it denies the consumer the ability to shop around.”
Minimum advertised pricing can be imposed by a supplier on a retailer or negotiated between both parties. It can prevent retailers from advertising lower prices, even when they’re prepared to offer them in-store.
“That also means that discount grocers are disincentivized from offering those discounts, because that’s how they attract business by advertising their discount prices,” Pratt said.
She added that minimum advertised pricing policies don’t necessarily violate the Competition Act.
There can be legitimate reasons, like when a manufacturer’s product requires a retailer to invest in specialized staff training or additional sales support. But the bureau doesn’t currently see a justification for food products.
“If you buy a box of pasta, you shouldn’t need extra sales support to buy that box of pasta,” Pratt said.
The bureau is trying to determine where the policies are being used, how widespread they are, why they exist and what effect they have on competition and consumer choice.
At Charlottetown’s Riverview Country Market, assistant manager Trisha Viaene said the independent grocer hasn’t encountered the restrictions, but offering discounts helps get people through the door.
“Everyone is watching what they’re spending right now,” Viaene said.
She said the store absorbs the cost of its specials and relies mostly on social media to make sure customers know when something is on sale.
“We always put our sales out every Thursday and we’re consistent with that, so they know when to look for it,” Viaene said.
As part of its investigation, the Competition Bureau is now calling on retailers, suppliers and others who have dealt with minimum advertised pricing to share their feedback.
The bureau says that information will support its broader examination of Canada’s food supply chain and could inform recommendations to governments on how to improve competition in the sector.
