Moore McDowell on "rip off Ireland"

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Moore McDowell on "rip off Ireland"

Moore McDowell had an interesting piece in Friday's Indo in which he argued that while grocery margins are indeed higher here in the Reoublic of Ireland compared to Northern Ireland and mainland UK, the restrictions of the Grocery Order and strict planning laws which limit the size of retail outlets play a large part in this. He argued that these restrictions suit sectional interests and shield them from free market competition.

In passing he also mentioned the fact that the ODCA recently won a case against a retailer for below cost selling of baby food products which was in breach of the Grocery Order (this was discussed recently on AAM) and the fact that the Grocery Order applies only to groceries so it seems that other non food products can be sold below cost with impunity.

Just wondering if others have any views on this?

I'd post a link to the Indo's article but their website terms & conditions don't allow for that sort of carry on even though (free) registration is required in order to read articles online anyway... :|

 

[Tommy]

I didn't read the article but I am familar with McDowell's views on this area, with which I largely concur.

Having previously supported the "below cost selling" ban imposed by the Groceries Order, I think there is now a clear case for its abolition. One only has to look at the preponderance of price competition in retail stores in Northern Ireland (and the relative lack thereof here) to notice the difference.

The fact that it is already legal to sell perishable groceries below cost in the South already makes the ban relatively pointless. Consumers are not stupid. In general, they notice higher prices and in general are careful not to be ripped off or fooled by "loss leaders"

Also, the knowledge that retail prices for non-food grocery items are prohibited by law from deflating below a certain level must provide a lovely cushion for distributors and maufacturers of such products. In the North, retailers are heavily slashing prices on goods like nappies and babyfoods. I would imagine they can only do so by negotiating discounts with their suppliers. In the South, this can only be done to a very limited extent so the suppliers enjoy ridiculously fat margins, at the expense of the consumer.