Supermarkets

Supermarkets are about scale, power and choice. Their global reach and high volume creates economies of scale, particularly in distribution. Large market share makes each a powerful buyer, with an influence along the supply chain that leaves state regulators in awe. And, behind the modest insistence that they serve customer demand, they exert a profound influence on what we want and on what we buy.

Supermarkets’ economies of scale, power along the supply chain and influence on our consumption habits put them in an important position to promote a fairer, greener and healthier food system. Indeed, many major retailers now make bold claims about their performance on each of these counts.

However, supermarkets face structural challenges in living up to these ambitions:

• Their economies of scale enable efficiencies, but efficiencies may not be sufficient to reduce our environmental footprint to a sustainable level.
• Their power as buyers pushes the costs of higher environmental standards onto suppliers and workers.
• ‘Choice editing’, now considered to be a crucial tool in promoting sustainable consumption, is difficult for businesses built around product differentiation and market segmentation.

Priorities

The challenges facing retailers’ efforts to be fair, green and healthy cannot be addressed by retailers acting alone. They require restructuring of the food retail sector. Government and investors are better placed than retailers themselves to ensure the sector is sufficiently accountable to its customers, suppliers and the public.

We need to think what else the future of food retail could look like – what would be the greenest, fairest and healthiest ways of getting hold of our food? It isn’t enough to ask which supermarket chain is doing best. We need to know whether the best is good enough.