Since establishing the Grocery Retail Sector Market Inquiry in October 2015, the Competition Commission finally made public its findings which looked into key areas of concern in the grocery retail sector. It found features that ‘may prevent, distort and restrict competition’ effectively excluding widespread participation in the retail sector where barriers to entry should be low and participation possible. These relate to:
- the use of long-term exclusive lease agreements and the exercise of buyer power by the national supermarket chains;
- the inability of small and independent retailers, particularly spaza shops to adapt to a changing competitive environment; and
- the lack of a pro-competitive regulatory regime that is aligned with the convenience model associated with small and independent retailers.