Supermarkets: retail food pricing and promotional practices
- Competition and Markets Authority
- 12 January 2012
- 20 November 2012
- Case type:
- Consumer enforcement
- Case state:
- Market sector:
- Retail and wholesale
- Consumer enforcement - changes to business practices agreed
Office of Fair Trading (OFT) closed consumer enforcement case.
Case reference number: CRE-E/28039
Complainant: OFT own-initiative investigation
Purpose of the investigation
The OFT launched an investigation into the supermarket sector to consider concerns that shoppers could be confused by the way food and drink prices are displayed, advertised and promoted.
Findings and outcomes
The OFT has made no finding that the supermarkets investigated have breached the law or were engaging in misleading promotional practices. However, the OFT did find that there was a variety of approaches to interpreting and applying relevant legislation across the food/drink retail sector
Action following investigation
The OFT has worked with a number of major UK supermarkets and developed a set of principles to establish a more consistent approach across the sector.
These principles should help to ensure promotional claims are meaningful and accurate. Eight food and drink retailers have agreed to use these principles within their businesses.
The OFT is also working with local authority Trading Standards Services and other stakeholders, including the Trading Standards Institute (TSI), to ensure that published business guidance (including the BIS Pricing Practices Guide, responsibility for which has recently been transferred to the enforcement community) is up to date and achieving its purpose.
The principles agreed
In summary, our principles cover two promotional practices:
First, internal reference pricing (for example, 'Was £3, Now £2' or 'Half Price' labels), where there have been public concerns about:
- whether prices are artificially inflated to make a later 'discount' look more attractive
- whether prices are presented as discounts for longer than the higher price was initially charged, and
- whether the comparison between current and previous prices is meaningful and relevant (based on such things as when and where the price was charged).
Second, pre-printed value claims on packs (for example, 'Bigger Pack, Better Value'), where there have been public concerns about:
- whether the claims are reliable, and whether there are cheaper ways of buying the same volume of the product elsewhere in the same store.
More detail on the principles is contained in the Text of principles (pdf 76kb)
- Press release Eight supermarkets sign up to OFT principles on special offers and promotions (30 November 2012)
- Questions and answers
Opened: 12 January 2012
Closed: 20 November 2012
Case type: Consumer enforcement
Case state: Closed
Market sector: Retail and wholesale