Giant denies "Tesco Town" (From Daily Echo)

Giant denies "Tesco Town"

7:59am Wednesday 4th April 2007 in Hampshire Business By Gareth Lewis, Business Editor

SUPERMARKET giant Tesco has denied Southampton is part of a country of "Tesco towns" as it set out a robust defence to accusations it has a near monopoly of the UK grocery market.

The denial comes as it emerged there are 19 Tesco stores in and around Southampton - nearly double the number in rival cities such as Portsmouth.

Shopkeepers and politicians said the number of local branches of the supermarket chain, which recently opened its ninth Tesco Express convenience store in the city, was harming other shops and reducing choice.

The Competition Commission is investigating whether or not the UK's four largest retailers - Tesco, Sainsbury's, Asda and Morrisons - abuse their power to dominate the grocery sector, limiting consumer choice.

Defending its dominant position, Tesco claims the current level of competition has 'produced huge benefits' for customers, including falling prices and 'an explosion in genuine choice and diversity', improving service levels and rising levels of customer satisfaction.

Critics point to its control of more than a third of the UK grocery market, record profits of £2.2 billion and claims it takes one in every eight pounds spent in Britain's shops.

Rashmi Chande of the East Street Traders Association in Southampton said Tesco's dominance was hitting his 33 members.

"They are on the prowl and everybody is affected," he said. "They are really encroaching on everybody's territory and the small guys are competing with a giant and they don't have a chance. We do find there's an impact "They have got free parking, they have got long hours of opening and the city centre is being bypassed because of high parking charges, toll bridge charges and Internet shopping. The footfall through East Street is definitely declining.

"The members say their share of the market gets smaller and smaller. It's inevitable and people are resigned to it. There's no hiding it. The big boys are encroaching on the smaller traders."

Labour leader and town planner, Cllr June Bridle, said: "It's beginning to feel like a monopoly. I sit on the planning panel and we have had an awful lot of the small Tesco Express stores.

There's a growing dominance of the Tesco brand.

"I think Southampton is worse than the national picture and it's restricting choice."

Conservative city councillor Royston Smith said: "I think we have had quite enough Tescos in Southampton.

"I like competition, but I like choice equally and we are now in a position where people are not getting the choice they're used to."

Southampton chamber of commerce director general Jimmy Chestnutt said: "Independent newsagents, grocers, convenience or specialist shops are often family run businesses and when they have to close down it is not only the loss of that family's livelihood at stake, but the loss of local employment and a local amenity as well as a blow to the community identity.

"The Southampton and Fareham Chamber of Commerce supports an investigation into current conditions of business with regards to the potential near monopoly of large retail units. Hundreds of small shops are going out of business every year and this trend must be examined to discover the part played by large supermarkets and any other influences".