NGA reinforces need for buyer power scrutiny in merger guideline comments

Buyer power scrutiny

On Tuesday, The National Grocers Association (NGA) threw its support behind the Department of Justice and Federal Trade Commission for their move to rewrite merger guidelines to curb mergers that foster anticompetitive buyer power.
 
“After decades of unchecked grocery consolidation, large national chains like Kroger and Albertsons are merging, arguing they need the additional buyer power to remain successful against the big box and e-commerce giants,” said Chris Jones, NGA senior vice president of government relations and counsel, in a statement this week. “The draft updated merger guidelines acknowledge the critical issue of buyer-side market power and its potential to undermine competition. In our comments to antitrust enforcers, NGA is reinforcing how constraints on buyer power will protect grocery competition and consumers.” 

In July, the Federal Trade Commission and the Department of Justice released a draft update of the merger guidelines.

Attorney General Merrick B. Garland weighed in, saying that “unchecked consolidation threatens the free and fair markets upon which our economy is based.” 

Swipe fees fight

Another fight for independent and small grocers is continuing and this one has to do with credit card swipe fees.

On Tuesday, the Independent Grocers Alliance (IGA), which was founded in 1926 to bring family owned, local grocery stores together under the IGA brand, sent out an email urging small businesses to contact their Senators regarding credit card swipe fees.

"We small businesses aren’t asking for a handout or government funding. We simply want justice in an unjust and rigged system. Let us break the stranglehold the duopoly has created, open up competition, and let merchants and shoppers take back some of the obscene profit margins of the credit card processing industry," IGA CEO John Ross said in the email.

Earlier this year, Durbin and U.S. Senator Roger Marshall, M.D. (R-KS) introduced the Credit Card Competition Act, bipartisan legislation that would enhance competition and choice in the credit card network market, which is currently dominated by the Visa-Mastercard duopoly. The legislation is estimated to save merchants and consumers $15 billion each year, and this week, Durbin urged the Senate to bring the bill to the floor for a vote.

Last Thursday, Durbin met with Home Depot CEO Ted Decker to discuss swipe fees.

“Visa and Mastercard set the fees on behalf of thousands of banks and tell merchants to take it or leave it. Merchants have no real choice but to accept the outrageous fees,” Durbin said in a statement. “In 2022 alone, U.S. merchants and consumers paid $93.2 billion in credit card interchange fees to line the pockets of the biggest Wall Street banks. During our meeting, we discussed my Credit Card Competition Act, legislation that would address these excessive interchange fees—American consumers and merchants are fed up.”

Rebrand aids independents

Alliance Retail Group (ARG), one of the largest self-negotiating grocery ad groups in the United States, announced its rebranding this week.

ARG, which has played a critical role in the independent grocery space for over 30 years, is now under one company umbrella to streamline communications as it works with vendor partners to drive retailer success.   

The company's mission statement makes clear it sees strength in unity: “Independent grocers have a fierce entrepreneurial spirit. That’s how they can survive in the crowded modern marketplace. By banding together with a thousand other independent retailers, we can prosper together.”

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