News retailers have condemned the Office of Fair Trading’s decision not to conduct a full investigation of the news and magazines supply chain.
The Association of Convenience Stores (ACS) chief executive James Lowman said: “The OFT failure to act is an abdication of its responsibility to consumers. By not taking action they are propping up a wasteful monopoly supply chain that continues to fail consumers.
The ACS has said that the OFT is sanctioning a market where choice is prohibited by news and magazine publishers and their profits are maintained by imposing constant reductions in retailer margins. Also where wholesalers benefit from exclusive distribution territories and can impose arbitrary delivery charges that news and magazine retailers have to accept.
“There exists a persisting problem of oversupply of certain products no one wants to buy – millions of magazines were printed, distributed, unsold and pulped in 2011 – and undersupply of others leading to poor availability of the titles customers do want to buy,” added Lowman. “As a result customers suffer.
“We fundamentally reject the OFT’s conclusions on availability, store numbers and self- regulation, we can only assume that the reason they have reached these conclusions is because of the flaws in the process they have undertaken.”
The ACS is now considering what further action to take.