The Competition Bureau has initiated a probe into the implementation of minimum advertised pricing policies within the grocery industry. These policies restrict retailers from promoting their lowest prices, potentially impacting consumers’ ability to find cost-effective deals and fostering a lack of price competition. Moreover, these policies could impede the entry of new discount grocers, facilitate price coordination among existing grocers, and hinder consumer access to competitive prices.
Jeanne Pratt, the interim competition commissioner, emphasized the importance of grocery stores being able to showcase their best deals to meet consumer expectations. She expressed concerns that such policies may hinder grocers’ competitiveness and limit consumer access to affordable prices, particularly in a time when food affordability is a pressing issue for Canadians.
Minimum advertised pricing policies establish a minimum price threshold for retailers to promote a product, although they may still sell it for less. These rules are utilized by suppliers in the retail sector to safeguard a brand’s reputation, incentivize retailers to offer superior service, and prevent certain retailers from benefiting from others’ promotional efforts.
The Competition Bureau is urging industry stakeholders and consumers to provide evidence regarding the use of minimum pricing policies. The information gathered will support the ongoing investigation and aid in assessing competition dynamics within Canada’s food supply chain.
Earlier this year, the bureau commenced an inquiry into competition within the grocery sector, focusing on potential challenges in production, processing, transportation, distribution, and pricing.