MSPC has written fairly extensively on the federal and state lawsuits to stop the Kroger-Albertsons store merger.
At stake, we have said, is the arguments use false flags of “lessening competition and job losses” and also were heavily reliant on an archaic definition of “grocery stores” and the consumers who shop at them.
Just last year, I published a piece in The Spokesman-Review outlining the reality of today’s shoppers.
My assessment stands true today: Like it or not, the way we shop has dramatically changed. More Americans are doing their shopping online or at a discount warehouse. Fewer go inside the grocery store, and if they do, they are going for a specific product not their full shopping experience.
The fact is that 30 years ago, supermarkets accounted for 81% of retail sales. Today that number is roughly 50%. That’s because online and warehouse competition has changed everything – and it has helped lower the cost of many goods and given consumers more choice in where they buy products and the ability to shop at several stores for the best deals.
The fact is, despite the rulings at the state and federal level to halt the store merger, traditional grocery stores are fighting for survival against the Goliaths of the grocery marketplace: Walmart, Amazon and Costco.
Here is some perspective I have continued to point to: Walmart/Sam’s Club, make up nearly 30% of the U.S. grocery market share. Costco is 7% and Amazon is more than 5% of the overall grocery market. Albertsons and Kroger combined makes up a paltry 9% of nationwide sales.
Free-market principles work – more competition means lower prices for consumers. Now that the courts have weighed in and put a hold on the merger, it remains to be seen what will happen to the small grocers like Kroger and Albertsons.
If the Jet Blue and Spirit airlines’ merger that the Federal Trade Commission declined gives us a preview, we can expect job losses, increased costs and less choice for consumers.
Washington state’s next attorney general and the new federal administration should take note of the changing landscape and revisit our nation’s free market success.