Tesco accused of running Highland monopoly

BUSINESS organisations and cross-party Highland politicians have attacked Tesco's "disgusting exploitation" of Inverness shoppers, which they claim is the result of the supermarket giant's near-monopoly of the city's supermarket sector.

The attack precedes the publication later this month of report by the All-Party Parliamentary Small Shops Group (APPSSG), which has heard evidence about Tesco's alleged anti-competitive practices throughout the UK.

Inverness was last year named as the UK's top "Tesco Town" by retail market researchers CACI, whose survey found that out of every pound spent by food shoppers in Inverness, 51.21p was spent in Tesco. Second on the list was Milton Keynes with 49.69p. Out of the other Scottish cities Dundee comes tenth with 42p, Falkirk/Stirling is 15th with 39p and Edinburgh 65th with 27p.

Danny Alexander, Liberal Democrat MP for Inverness, Nairn, Badenoch and Strathspey, and a member of APPSSG, said Tesco ran "an effective monopoly" in Inverness, and alleged that it was exploiting its dominance to charge 3p or 4p a litre more for petrol in Inverness than at its store in Elgin. This is despite the Inverness store being closer to the supply point at Inverness harbour. "Supermarkets have a local pricing strategy based on what they can get away with." he said.

SNP MSP Fergus Ewing told The Scotsman yesterday he was seeking a meeting with Tesco's board to discuss the charge.

"This is a very serious allegation, and it needs to be explored with Tesco directors. I am also keen to pursue the issue of whether there should be a rethink of business rates to reflect the realities of modern shopping practices and to level the playing field in favour of the small, traditional retailers."

Inverness-based Conservative MSP Mary Scanlon said: "It's a very dubious honour to be Tesco capital of the UK. I do think that the supermarket abuses its monopolistic position in Inverness."

Inverness currently has three Tesco stores outside the city centre. A submission for planning permission for a fourth is being prepared. Small traders' groups say that a fourth site would see the city centre "surrounded" and would worsen the "doughnut effect", devastating the city centre.

Charles Morgan, spokesman for the City of Inverness Trading Association, said: "Tesco's dominance is disgusting exploitation and Holm Mills will complete the encirclement. Inverness is the fastest-growing city in the entire UK so why is it that 30 businesses have closed in the past 24 months?"

A spokesman for Tesco denied that the store had a monopolistic position in Inverness, saying: "The reason we have more stores than our competitors is that we have stuck with and invested in the city where others haven't. The fact is that customers chose to shop with us."