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Independent shops aren’t the only organisations under siege from big business. Local retailers may have some sympathy with independent operators of tied pubs. The publican has to buy beer at prices set by their leasing company, after government regulators decided not to change their industry.
CAMRA, a consumer group with more than 100,000 beer-drinking members, had complained to the Office of Fair Trading that the market was rigged against their interests, pointing at the way that tied pubs were controlled. The OFT, in finding against CAMRA’s complaint, used the “Alan Greenspan” defence by suggesting that pub-owning companies would not operate strategies that would compromise its commercial position. If it weren’t true for Wall Street banks, must it be true for pub companies?
At the same time, in the USA, the American Booksellers Association has written to the government asking for it to investigate predatory pricing by Walmart, Target and Amazon.com. New hardback best sellers listed at $25 to $35 are being sold at $9 in these stores, well below cost.
The ABA, which represents local bookshops, makes the case that selling books at a loss is being done to attract shoppers to buy other, more profitable merchandise. “The entire book industry is in danger of becoming collateral damage,” it says. The ABA says that lower prices for best sellers, the most important products in its members’ shops, is likely to stifle innovation, make it harder for new authors to emerge and result in fewer people reading. The complaint has to be made, but many independent businesses would be surprised if the little guy won.
The structure of the beer market in the UK and the book market in the US is undergoing major change. Local shops may benefit from the trend to “big nights in”, which takes sales from local pubs. But local shops are equally likely to find themselves at the mercy of the major retailers’ marketing wars – especially if they decide to use what you sell in their promotional battles.
Individually, independent retailers can do little. However, shopper organisations and trade associations have an important role to play in representing your views. While it may seem expensive, in both time and money, to take part in projecting a view about why what you do is in the wider social good, it is a key part of business.
You may be cynical and say that the little guy always loses. But a good businessman will fight on regardless, confident that one day his side will win. Endangered species need a voice – don’t fool yourself into thinking that someone, somewhere is not thinking about organising markets in a way that will hurt your business.
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