Dispatches

I was watching a programme called Dispatches on Channel 4 entitled: The Supermarket That's Eating Britain last night and I was overwhelmed by the facts and figures of companies who are potentially becoming a monopoly in the market.

The programme mainly dealt with the issues surrounding the power of Tesco has been. I don't blame the producer for airing the programme as it is a fact that Tesco is the biggest supermarket in the United Kingdom. I am not sure about in other countries but there are at least 5 big Tescos in Malaysia alone!

Let me give you my two cents worth. Who will be the one who is going to loose out in this trade? Well, in a nutshell, small traders will loose out. The reason why am I saying this is because with a company who has deep pockets, they could afford to spend money in research and development. Not only that, they will have a team of specialist cater to do market research.

What was so interesting about that programme is that the programme did show disappointed residence where Tescos were being build on as it will be a potential danger to nearby residence if unloading personnels are careless. Accidents can happen. That is why we have health and safety laws (thank God for it).

Anyway, the programme did open my eyes and filled me with lots of information which I would not be able to look for in newspapers. Those guys in Channel 4 have done a good job!

I am thinking that whether big companies like Tesco will be in breach of EU anti-competition law. With a company like Tesco, they have the capacity to indulge in fund raising campaigns and involved itself in many activities like promoting a free pc for the school. In that programme, I found out that parents would have to spend more than £2000 in order to raise enough coupons in exchange for a free pc for the school. Well, £2000 is a lot of money. Is it worth it? Why not Tesco donate PCs to schools instead? Wouldn't it be better and straight forward?

Well, I am just thinking that with money and power, Tesco will have the ability to venture into many other fields. They do food and non food products now. If I am not mistaken, they are investing money into building materials. Ha! They are going to build houses in London! Could you believe it?

One more thing is that the issue of anti-competition law will fit right in it. With opening of new big branches and also small branches close to other smaller shops, it will surely drive small traders to brinks of collapse. Why? Small traders will not be able to buy raw materials cheaper than big companies like Tesco due to the size of their business. I don't think any small traders will be able to buy products in big lots like Tesco. If they could not buy products as cheap as Tesco, they will lose out to big companies like Tesco as consumer will always go for the best quality goods and at the same time, cheapest. This is unfortunately true, I am afraid.

There are other ways in which small traders can compete with big firms like Tesco. What they could do is to form an association and work from there. It is just like fund managers. They will invest each and every individual person's money to gain more profit. How much could a single individual buy shares or bond which will be able to compete with fund managers? we are talking about good fund managers here. With a good pool of money, fund managers will be able to make even more money.

Tell me what do you all think.