The Association of Convenience Stores (ACS) has welcomed a decision by the Competition Commission to extend the timetable of investigation into the grocery market by three months.

In a letter to the main parties, the Competition Commission has announced that its report into competition problems in the grocery market, which was originally scheduled for publication in November 2007, will now be released in February 2008. The deadline for provisional findings has now also been moved back, from June 2007 to September 2007.

The commission is to continue with further analysis, covering any possible waterbed effect, including the model submitted by ACS prior to the Emerging Thinking, prices charged by grocery suppliers to grocery retailers and wholesalers, an assessment of barriers into grocery retailing and the impact of below-cost selling and other pricing strategies.

Chief executive of ACS, the lobby group for over 32,500 local shops, James Lowman said: “This inquiry is a once-in-a-generation opportunity to achieve fairness in the grocery market and is too important to rush the conclusions. We had warned the commission that the original timetable caused unnecessary pressure on the process.”

There are a number of reasons to extend the timescale, according to Shane Brennan, ACS public affairs and communications manager. “There has been a significant amount of information presented to the commission over the last year and also a significant amount of work left for it to achieve,” he told FPJ. “The commission set itself an ambitious plan which we did not understand, but now we are sure it will do a very thorough job, and welcome the extra time this move allows.”

The Commission has also given further detail on how it will go about measuring competition in local markets, including plans to undertake SSNIP analysis to assess competition in local markets, an approach that enables analysts to work out if there is a grocery monopoly in any given area. “While we remain willing and able to assist with this work we remain cautious about the use of the SSNIP approach,” said Lowman. “Our concern is that any analysis is only as good as the data upon which it is based. Collecting that data in the right way is the main challenge that the commission faces at this stage.

“We wholly reject the simplistic approach which has been put forward by Tesco that consumers are a homogenous group all with access to all shops in a 30-minute drive time. Such an approach is irrelevant to the 27 per cent of households that do not have a car, and we are confident that this will not be the ultimate conclusion of the commission,” Lowman added.

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