The Competition Bureau has initiated a probe into the implementation of minimum advertised pricing strategies within the grocery industry, which are policies that restrict retailers from promoting their lowest prices publicly.
The regulatory body is assessing whether these policies hinder Canadians from discovering discounts, diminish price competition, erect obstacles for discount and emerging grocers, and facilitate price coordination among grocers.
Jeanne Pratt, the interim competition commissioner of the agency, stated on Monday, “Canadians anticipate that grocery stores should have the ability to showcase their top bargains.”
“We are apprehensive that policies impeding this may impede grocers from competing effectively and limit consumer access to reduced prices,” she added. “Given the persistent concern regarding food affordability among Canadians, we aim to gather insights on the impact of these policies on grocery prices and consumer options.”
Minimum advertised pricing policies establish a minimum price at which retailers can promote a product, even though they may still sell it for a lower amount.
Within the retail sector, suppliers may utilize these rules to safeguard a brand’s reputation, incentivize retailers to offer superior service, or prevent certain retailers from capitalizing on the promotional efforts of others.
The bureau is urging industry stakeholders and consumers to provide evidence regarding the utilization of minimum pricing. The data received will aid in the investigation and contribute to the analysis of competition within Canada’s food supply chain.
In June, the agency commenced an inquiry into competition within the grocery industry, encompassing potential issues in production, processing, transportation, distribution, and pricing.