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Buyer Power and Competition in European Food Retailing

Roger Clarke, former Professor of Economics, Cardiff University, UK, Stephen Davies, Professor of Economics, University of East Anglia, UK, Paul Dobson, Norwich Business School, University of East Anglia, UK and Michael Waterson, Professor of Economics, University of Warwick, UK
In this book, leading experts in the field examine the effects of the recent growth in concentration in the European food retailing sector. In particular, the book develops a number of buyer power propositions and builds on the previous work of several of the authors, to consider how the growth of large supermarket chains affects competition in food retailing. The authors outline the theoretical and policy analysis underpinning the work and assess evidence on the size and growth of supermarket chains across the EU. Whilst not entirely critical, they suggest that there is strong evidence in some countries that supermarkets use their buying power to impose unfair terms and conditions on suppliers, particularly affecting small suppliers.
Extent: 224 pp
Hardback Price: $127.00 Web: $114.30
Publication Date: 2002
ISBN: 978 1 84064 685 6
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  • Economics and Finance
  • Competition Policy
  • Industrial Economics
In this book, leading experts in the field examine the effects of the recent growth in concentration in the European food retailing sector. In particular, the book develops a number of buyer power propositions and builds on the previous work of several of the authors, to consider how the growth of large supermarket chains affects competition in food retailing. The authors outline the theoretical and policy analysis underpinning the work and assess evidence on the size and growth of supermarket chains across the EU. Whilst not entirely critical, they suggest that there is strong evidence in some countries that supermarkets use their buying power to impose unfair terms and conditions on suppliers, particularly affecting small suppliers.

The authors use case studies, to provide an in-depth analysis of four European countries, namely France, Germany, Spain and the UK. The book ends with a discussion of policy issues against a backdrop of likely future trends in concentration in this area.

Academics working in the areas of microeconomics and industrial economics as well as those involved in European competition policy more generally, such as lawyers, civil servants and consultancy groups, will find this volume enlightening.
‘This excellent book is a major contribution to our understanding of the nature, behaviour and degree of competition amongst food retailers in both empirical and theoretical terms. . . for those teaching food industry economics, the book’s clarity of approach and provision of large volumes of data will make it an invaluable reference text for students.’
– C.W. Morgan, Journal of Agricultural Economics

‘This book presents a timely and interesting overview of retail power in the European food market. By approaching the subject primarily from an economist’s perspective, the material adds value to that already available from marketing and management academics. It also illustrates, quite clearly, the problems of comparability of data, and the definitions and measurements of retail power, which make retailing such a complex (and interesting) sector to study.’
– Steven Burt, International Journal of Retail and Distribution Management

‘Buyer Power and Competition in European Food Retailing without doubt makes a valuable contribution to the academic literature on European retailing.’
– John Dawson, Journal of Contemporary European Studies

‘The authors are to be congratulated on tackling a difficult and extremely important topic in such an authoritative way. The empirical evidence they present and analyse on concentration amongst large retailers in the European food industry is likely to remain a prime source of reference for subsequent researchers for a very long time. In addition, the framework they develop to analyse “competitive” issues in the sector will, probably, find its way into future antitrust investigations.’
– Michael Utton, University of Reading, UK
Contents: Preface 1. Introduction Part I: Theoretical and Policy Underpinnings 2. The Economics of Monopsony and Buyer Bargaining Power 3. Buyer Power Propositions 4. Definition and Measures of Buyer Power 5. Competition Policy and Buyer Power Part II: Statistical Analysis 6. An Overview of Market Structure Based on Existing Sources 7. The EU Retail Food Market Share Matrix Part III: Case Studies 8. Food Retailing in France 9. German Food Retailing 10. Food Retailing in Spain 11. United Kingdom Food Retailing 12. Issues and Lessons Arising from the Case Studies 13. Summary and Conclusions Appendix: Questionnaires and Interviews Reference Index