Published reports say that a new study in the UK by the New Economics Foundation says that between 1995 and 2000, 20 percent of Britain’s corner shops, banks, post offices, pubs and grocers were closed because of “the march of globalisation.” If the trend continues, according to the study, a number of communities could become ‘economic ghost towns” within the decade.
The report lays much of the blame on the nation’s supermarket industry, which accounts for 70 percent of all food sold in the UK.
The report lays much of the blame on the nation’s supermarket industry, which accounts for 70 percent of all food sold in the UK.
- KC's View:
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While the first instinct is to blame Wal-Mart (because most retailers believe that Wal-Mart is to blame for every problem they have), keep in mind that Tesco, Sainsbury, and Safeway Plc are key players in the UK. Wal-Mart’s Asda Group is doing its share of damage, but it hardly is alone.
In the UK, there are calls for legislation that would rein in the big supermarket chains and assist the smaller companies. There may be both precedent and political safety in such legislation in the UK, but it is hard to imagine such a thing happening here in the US.
While there are plenty of small retailers who would welcome such legislation, these options carry a certain irony because many of these same people would, under other circumstances, decry the notion of government interference.
We still think that it is foolhardy to believe that Wal-Mart is the root of all evil. The fact is that retailers that spend all their time belly-aching about Wal-Mart are spending too little time aggressively competing with the Bentonville Behemoth, too little time developing their own differential advantages.
