ABSTRACT
This chapter examines the barriers facing entrants into UK grocery retailing generally, with special attention to the phenomenon of increased retailer advertising expenditures. In the UK, there has been a significant increase in concentration in grocery retailing. The four-firm concentration ratio has risen from 26 percent in 1970 to 40 percent in 1980. The chapter also examines the causes and effects of this rise in concentration. In the UK grocery trade, the UK Monopolies and Mergers Commission has concluded that rising concentration has been associated with buying power; the chapter re-examines that evidence. It describes the barriers facing entrants into UK grocery retailing generally, with special attention to the phenomenon of increased retailer advertising expenditures. UK grocery trade has revealed a substantial increase in concentration over the years 1970–1980, which trend appears to be continuing into the 1980s. The increases in concentration, and buying power, appear to have had an appreciable effect on suppliers.
