Reply to: Kapitalism

[SpontaneousOrder]

They wield such power because of their market share.

You're just begging the question. So do they have such power, from such a market share, because of their uncompetitiveness ?

[vetran]

Well it all it needs to screw up one supermarket chain is for a couple of companies like Unilever and Nestle of which I think you'll find many of the products on the shelves come from:

Unilever: View brands | Brands in action | UK & Ireland
Nestle: Brands

And for them to say to supermarket A that they will no longer provide their products to them if they continue with this practice, then go to supermarket B and offer them discounts of their products if they don't use this practice. Supermarket B can then offer the goods to the consumer at a decent price and supermarket A will go tits-up...

And supermarket A will do a temporary deal with with L'Oreal whilst building up a an own brand or presonalised brand to replace them. Not as many people as you think are brand loyal. But yes that is the way to weaken the Supermarket's hold.

[darmstadt]

Well it all it needs to screw up one supermarket chain is for a couple of companies like Unilever and Nestle of which I think you'll find many of the products on the shelves come from:

Unilever: View brands | Brands in action | UK & Ireland
Nestle: Brands

And for them to say to supermarket A that they will no longer provide their products to them if they continue with this practice, then go to supermarket B and offer them discounts of their products if they don't use this practice. Supermarket B can then offer the goods to the consumer at a decent price and supermarket A will go tits-up...

[SueEllen]

Very few companies can do what L'Oreal did - I don't think any UK national firm would risk it.

While it's easier for a multinational, smaller firms have done so and lived with the consequences e.g. going bust, losing market share.

[AtW]

There are some companies that supermarkets can't try that with. Tesco wanted to try it with L'Oreal.

L'Oreal told Tesco fine we will just remove all our products from your store.

Basically as a supplier you need to get your goods into supermarkets and other stores even if they are pound shops, drug stores, garages plus online. Once your retailers are diverse you can't be held to ransom.

Very few companies can do what L'Oreal did - I don't think any UK national firm would risk it.

[AtW]

So they wield such power due to their uncompetitiveness?

They wield such power because of their market share.

[SpontaneousOrder]

Okay, but first you give me something before I get something from you in order for me to give something to someone who wants your original something... as in:

You: Yes, I would like that contract at x pounds per hour
Agent: Okay but in order for you to do the work I want you to pay me y pounds an hour, fair enough?
You: But you're already getting your cut from the client
Agent: Ah, that's them paying me to let you work there and deal with all the dirty stuff. This is you paying me to let you work there. Luckily I talked the end client out of you having to pay them as we're on their PSL

Sounds like agent justifying a poor rate because it's a 12 month contract. People go for it!

[SueEllen]

The price at checkout should be whatever covers supermarket costs + margin for decent profit. Supermarket however should be responsible for it's own costs (staff, logistics etc) and stop shifting burden of it's own incompetitiveness to suppliers via forced payments.

There are some companies that supermarkets can't try that with. Tesco wanted to try it with L'Oreal.

L'Oreal told Tesco fine we will just remove all our products from your store.

Basically as a supplier you need to get your goods into supermarkets and other stores even if they are pound shops, drug stores, garages plus online. Once your retailers are diverse you can't be held to ransom.

[darmstadt]

In fact, I smell a business opportunity! So who would like to purchase what from me for 10% over the supermarket price? I'm happy to help the supplier out if you guys are happy to cover the cost.

Okay, but first you give me something before I get something from you in order for me to give something to someone who wants your original something... as in:

You: Yes, I would like that contract at x pounds per hour
Agent: Okay but in order for you to do the work I want you to pay me y pounds an hour, fair enough?
You: But you're already getting your cut from the client
Agent: Ah, that's them paying me to let you work there and deal with all the dirty stuff. This is you paying me to let you work there. Luckily I talked the end client out of you having to pay them as we're on their PSL

[SpontaneousOrder]

stop shifting burden of it's own incompetitiveness to suppliers via forced payments.

So they wield such power due to their uncompetitiveness?

[AtW]

So what are we saying?... we don't like lower prices at the checkout? We want more competition for supplies, at the cost of higher prices?

The price at checkout should be whatever covers supermarket costs + margin for decent profit. Supermarket however should be responsible for it's own costs (staff, logistics etc) and stop shifting burden of it's own incompetitiveness to suppliers via forced payments.

[SpontaneousOrder]

So what are we saying?... we don't like lower prices at the checkout? We want more competition for supplies, at the cost of higher prices?

Because, you know, all of you who think like that could just not shop at large supermarkets and volunteer to pay more for those products than the supermarket is wiling to pay for them. Problem solved, right?

In fact, I smell a business opportunity! So who would like to purchase what from me for 10% over the supermarket price? I'm happy to help the supplier out if you guys are happy to cover the cost.

[DodgyAgent]

I guess it explains why you suddenly agree with my view ....

We could live without supermarkets, but live without IT recruitment agencies is unthinkable...

[AtW]

Apparently they did the same to a number of IT suppliers including recruitment agencies though it was over ten years ago.

I guess it explains why you suddenly agree with my view ....

We could live without supermarkets, but live without IT recruitment agencies is unthinkable...

[DodgyAgent]

Totally agree. And Tesco have been at it for years, ordering many small farmers and suppliers to give them cash, according to many media reports. According to reports, an instruction to forward a large sum of cash can come out of the blue. There will be a visit from a rep, an instruction to forward cash, and a letter detailing the consequences of not complying.

To my mind, this is "business" somewhat in the manner of Tony Soprano. Perhaps not quite extortion, but in my view pretty egregious and well beyond what would even be called "sharp practice". Power corrupts. And it corrupts good businesses just like people or unions. Needs outlawing soonest. Reminds me of wheel clamping in Scotland, which was going great until the Scots decided it was extortion.

Apparently they did the same to a number of IT suppliers including recruitment agencies though it was over ten years ago.