Just take a stroll down your one of your local supermarket’s aisles. Any one will do, all supermarkets are much of a muchness. There is a psychology behind their layout, honed to a competitive edge for over sixty years.
As you enter, what do you see?
Firstly, a fruit and vegetable aisle, then tinned foods, the bread counter, fish counter, a meat counter then, dairy products. Every aisle artfully laid out, designed to seduce you with alluring products from all over the world, a sensory overload with the aim of enticing you to load up your shopping trolley.
Shop complete, what do you see as you make your way toward the exit? A last ditch attempt to seize a few more pounds, a kiosk selling tobacco, magazines, sandwiches and sweets. From the moment you entered the hallowed halls, the object of the exercise is seduction and speed; to induce you to buy as much as they can as fast as possible. The tricks employed to achieve this have been perfected over sixty years, they include the layout of the shop, lighting, background music, all designed to encourage a feel good factor.
Shopping complete, speed through the till now becomes paramount. Every customer must be processed as quickly as possible then sent on their way so the next shopper can be seduced and processed; contactless payments speed your cash from your account into the supermarket coffers. After all, it’s a lot less laborious than counting out the cash from your wallet with the added benefit that the consumer doesn’t think about the amount so much.
Now stop and consider! In the not so distant past, when the pace of life wasn’t so frenetic, the produce in each of those supermarket aisles was sold by a family owned shop on the High Street. In old fashioned vocabulary, grocers sold general produce, green grocers sold fruit and vegetables, butchers sold meat. Each of these businesses has been destroyed by supermarkets whose sole aim is to make ever increasing profits for their shareholders. The list of destroyed businesses goes on; newsagents, fishmongers, clothiers, book shops, off licences. Every product listed represented a family owned business bankrupted by the supermarket’s ever inexorable appetite for profits from vulnerable market segments.
It gets worse. Supermarkets have whole areas sectioned of for clothes, greetings cards, books, cookware, stationary; yet more livelihoods that have been killed off. And yes most supermarkets have a canteen, so bankrupting your local café for good measure. They are just grasping aren’t they?
Compare the atmosphere of the supermarket with a walk along your local High Street. The contrast could not be starker. As supermarkets have enticed consumers away, the High Street has become a ghost of its former glory. How many family owned shops are left? Nowadays the High Street in many towns, especially deprived areas, are dominate
d by empty shops, charity shops and gambling arcades. Oh, and bookmakers.
What about the local garage that sold petrol? That’s gone too, their trade swallowed up by supermarkets who bulk buy at discounted prices and yet still manage to overcharge.
The avarice does end with the destruction of family owned shops on the high street. Supermarkets exert god like powers over their suppliers, seducing them with an offer of a contract giving the supplier a good profit margin. The supermarket buyers cannily ensnare the supplier with larger orders until they become the suppliers only or main customer, then they go for the kill. The contract is modified so the supplier’s profit margin is reduced year on year. They have now become completely dependent on the supermarket tied into a long term contract unable to find alternative customers. The supermarkets bleed the supplier dry then move onto the next victim. Another business ruined.
So what did the pandemic show us about this concentration of power into relatively few hands? When their just-in-time supply chain broke it caused immediate and widespread alarm. Word spread like wildfire over the 24 hour news channels causing consumer panic and a rush to hoard, would you believe it, toilet rolls.
This dysfunction can only happen in system that has been centralised with single point of failure. The old fashioned retail system of family owned shops was far more robust. They weren’t networked and so a shortage in one area did not cause a knock on effect in other localities.
The latest 6 month revenue figures for the supermarkets are astronomical, here is a selection from the leading group, £32 Bn, £17 Bn, £20 Bn. Staggering amounts aren’t they?