Bigger the company the more power they have to dictate the purchasing price from producers and the cost for consumers. This is not just in the food industry it is also in retail such as Amazon.
Companies like Kroger are so big they dictate the purchase prices from farms. The farmers were better off in the past with multiple competitors creating a bidding war. Same with consumers, products had to be priced right to win their business.
A company I work for had to give free engineering labor in millions of dollars to get access to one of the largest retailers in the USA. Too big not-to-do-business-with harms everyone except the retailer.
> Bigger the company the more power they have to dictate the purchasing price from producers and the cost for consumers.
That wasn't always true. The Robinson-Patman Act made it illegal to give preferential treatment to large retailers specifically in order to prevent what we're seeing with walmart and amazon today. The US just stopped enforcing the law (and also anti-trust laws that would have protected local/small businesses) so here we are. At any point the US could decide that enough is enough and fix the situation but we'd probably have to make it actually illegal for corporations to bribe government officials before it stands a chance of happening.
Cigarette companies (no surprise) are known to do a similar type of price fixing, although in their case it's targeting high-income shoppers for lack of discounts.
Noticed it a while locally, and national data agrees. If you want to shop for cigarettes, shop in low income, minority areas. [1] Cigarette companies specifically target stores with regular, habitual, high-income smokers for high prices and lack of discounts, while offering significant bargains in stores less than a mile away. [2]
But Robert Bork and the Chicago School of Economics and Ronald Reagan and the Republican Party assured me that mergers and trusts were good for me! Look, the companies even have self-serving rationalizations scribbled with crayons on butcher paper saying the same thing!
Seriously, though: I cannot believe how high and how far these utterly dogshit arguments flew without pushback and the amount of damage that consolidation has done to the American Experiment. The best time to get a Lina Khan in the FTC was 40 years ago but the second best time was 4 years ago. I just hope the next president picks up the project... though I'm sure the (by then) trillionaires will do everything in their power to stop that from happening.
Something like this has been going on in the restaurant world since seemingly forever. When I worked at a pizza joint (40-some years ago) we only served Pepsi drinks.
I was young and dumb enough then not to know that, for example, 7-Up and Sprite were not independent soft-drinks. I assumed every flavor of soda was its own company. I soon started to notice the drink pattern based on whether they had Coke or Pepsi. Those two owned all the other flavors—and they each had their own variant of the other's.
I was told too by management that we only bought Pepsi drinks. Again, native me thought, "Why not have both Coke and Pepsi and let the customer decide?" I am not sure whether there was a pricing issue that prevented management from buying both—like the loss of a discount for going Coke-only or whatever.
Of course you always saw signage, etc. around the restaurant with Pepsi logos (or Coca-Cola logos at other restaurants) so you knew there were gifts in other forms that one of the two would entice the owner with.
What a slow growing up I have gone through since then. It seems like the kind of thing they ought to teach in primary education.
Oh! I've witnessed this quietly every time I buy soda!
I'm a habitual enough soda drinker that I'm a six-pack-a-day diet soda drinker (don't judge me, at least it's not Red Bull). I notice that there's vendor collusion at Walmart for months at a time where the Pepsi six-packs will typically go on sale for a few months at a sub-$4 to $5 price (currently it's $4.98) while Coke packs will be $5-6 off sale.
Cycle three to four months and Coke will enter the $4 position and Pepsi goes back up to a full retail price for the next quarter.
I've always seen the 'cycle' of the two competitors constantly hitting a 'sale' price across various retailers.
I used to drink a lot of seltzer purchased in those 1 liter bottles. Then I bought a countertop soda maker. I can make the same amount of soda that I was paying $1.50 for at the store for $0.20 now. (I refill my own CO2 off a 10 lb tank) I can't imagine paying more than $0.50 for a liter of soda anymore. They have got to be making an obscene profit on those drinks.
Even weirder, the drinks that I flavor myself taste way better than the ones in the store. I suspect they have been titrating their flavoring down over time. Root Beer I make myself using drink powder tastes way better than the ones from the store. Same for grape and orange sodas.
Seems to be a pattern among all products I’ve ever encountered. I’m a heavy sales shopper. My local grocer (Ingles) will do a promo for Sargento cheese or Chobani yoghurt for instance, normal price of 5$ let’s say, then drop it to $2 for a week, then to $4 the next week, then back to full price. This rinses and repeats every 2 or 3 months for most sales products.
Sadly for this RedBull drinker, they never go on sale, at all, ever, anywhere.
As if we needed another reason not to buy junk food.
By the way, in France we have a 5.5% VAT on food, instead of 20% for other products. Junk food is also 5.5% but cat food is 20%.
I wonder if this is going to change some day for junk food or sodas.
Where are the mainstream media stories about this? The article mentioned the story blowing up but a Google search showed only one media outlet covering the story.
Time for a class action lawsuit. You can submit your personal information to a wordpress powered law firm's upload forms in exchange for your twenty bucks without inflation compensation in about 5 years and they collect a cool 50% fee distributed amongst millionaire lawyers.
I wish I could do the reverse. Could I and a million other people pay $20 now to a few law firms that could fight this without need for compensation and do everything to expose this to everyone in America?
Just stop buying Pepsi products. Stop going to Walmart. You don't need either. You don't need potato chips or soda or Gatorade or any of the other poison they produce.
Okay I'll go to Kroger who also has horrible anti competitive practices and buy their store brand which is literally just Nestle but in different packaging
>“I actually think we’re capable of taking whatever pricing we need,” said CFO Hugh Johnston in 2022. And the company did just that, raising prices by double digit percentages for seven straight quarters in 2022-2023.
I hate to say it, but was he proven wrong? People are still buying junk food and soda (their primary products) despite prices going up. Looking at Pepsis profit margin, it seems to have hovered between 9.5% and 10.5% since 2021.
The point of the complaint is that they were able to do this due to illegal collusion.
And even if people buy a lot of junk food, they might have bought competitors’ junk food. Laws are still laws even if you don’t like the people the laws protect.
The storm is likely within the administration and across governmental departments. Trump will try to drive out whoever doesn't toe his line, even if he legally doesn't have the authority to do so.
There often is a payment in the form of campaign contributions, and mysteriously cushy jobs after retirement from politics.
But, beyond that, while logically voters should vote against politicians that favor businesses over them, they often appear to do the opposite. They simply gain the label of "business friendly".
Capitalism as it is taught: lots of companies competing with each other, resulting in better goods at affordable prices! The customer wins!
Capitalism in practice: a relative handful of rich people cooperating with each other to extract as much money as possible from the middle and lower classes.
You can see which version of capitalism this document supports.
The "fiscally conservative" aspect of the Republican party (and the Democratic party to a lesser degree) don't want people to think of capitalism-in-practice; they want happy consumers who think that competition is still a thing. Since this document clearly goes against that narrative, it must be suppressed.
It's not the discounting that's a problem -- it's the intentionally watching other stores and preventing them from closing the "price gap" with Walmart
> As a result of Food Lion threatening Walmart’s price gap, Pepsi created a plan to nudge Food Lion’s retail prices on Pepsi products upward by reducing promotional payments and allowances to Food Lion and raising other costs for Food Lion
The Robinson-Patman Act is terrible law. It’s been routinely violated (unknowingly in most cases) for decades across effectively every sector of the economy & enforced vanishingly rarely.
If it were to be enforced uniformly and aggressively it would be devastating: Every negotiation between a supplier and a purchaser at every level is potentially a federal crime!
If it were to be enforced capriciously, it would put unchecked power over everyday commerce—again at every level—into the hands of the FTC and its political masters.
No thanks. Repeal it so we can stop hearing about this “one neat trick to roll back neoliberalism!”
Shout out to Friedman, Hayek, Rand, Reagan, and their neoliberal enablers in the democrat party like Clinton. All US Citizens and the unlucky citizens of our colonies are property of US corporations. Bought and paid for. It’s about to become really obvious to anyone paying even the smallest amount of attention just how screwed anyone not in the top 1-5% really is.
The legal theory is Robinson-Patman promotional discrimination, not a price-fixing judgment. The complaint’s factual story can imply broader price effects, but that is not the same as “proven collusion” across the whole economy.
The case was not dropped in February; it was extended.
Seems awfully dumb to attempt the whole "collusion on prices" thing when both you and your partner in crime are locked in your own cutthroat duopoly battles. What's to stop Coca-cola+Target from turning around and crushing Walmart+Pepsi on pricing the instant they try to "price-gouge"?
The whole point of Duopoly is to have a “competitor” so that you can continue to act as a monopoly behind the scenes while avoiding the appearance of a monopoly. You get to point finger at the other guy when there’s scrutiny and argue there’s no monopoly, but also increase your own prices when your competitor does it.
It’s not cutthroat, it’s comfortable partnership with a cutthroat veneer. If either of them wins, they have a monopoly and are at higher risk of regulation or breakup. So they fight openly over small fries, and keep writing dividend checks.
It's kind of like what's to stop you from stealing your neighbor's lawn gnome? You get a free gnome once and now neither of you can ever have anything on your property not bolted down ever again. Better to not hurt both of you by rocking the boat and instead slowly raise prices together. Cooperation is only hard when there's a lot of people involved.
yndoendo|2 months ago
Companies like Kroger are so big they dictate the purchase prices from farms. The farmers were better off in the past with multiple competitors creating a bidding war. Same with consumers, products had to be priced right to win their business.
A company I work for had to give free engineering labor in millions of dollars to get access to one of the largest retailers in the USA. Too big not-to-do-business-with harms everyone except the retailer.
autoexec|2 months ago
That wasn't always true. The Robinson-Patman Act made it illegal to give preferential treatment to large retailers specifically in order to prevent what we're seeing with walmart and amazon today. The US just stopped enforcing the law (and also anti-trust laws that would have protected local/small businesses) so here we are. At any point the US could decide that enough is enough and fix the situation but we'd probably have to make it actually illegal for corporations to bribe government officials before it stands a chance of happening.
araes|2 months ago
Noticed it a while locally, and national data agrees. If you want to shop for cigarettes, shop in low income, minority areas. [1] Cigarette companies specifically target stores with regular, habitual, high-income smokers for high prices and lack of discounts, while offering significant bargains in stores less than a mile away. [2]
[1] https://pmc.ncbi.nlm.nih.gov/articles/PMC6689253/
[2] https://truthinitiative.org/research-resources/tobacco-indus...
smallmancontrov|2 months ago
Seriously, though: I cannot believe how high and how far these utterly dogshit arguments flew without pushback and the amount of damage that consolidation has done to the American Experiment. The best time to get a Lina Khan in the FTC was 40 years ago but the second best time was 4 years ago. I just hope the next president picks up the project... though I'm sure the (by then) trillionaires will do everything in their power to stop that from happening.
everdev|2 months ago
toomuchtodo|2 months ago
JKCalhoun|2 months ago
I was young and dumb enough then not to know that, for example, 7-Up and Sprite were not independent soft-drinks. I assumed every flavor of soda was its own company. I soon started to notice the drink pattern based on whether they had Coke or Pepsi. Those two owned all the other flavors—and they each had their own variant of the other's.
I was told too by management that we only bought Pepsi drinks. Again, native me thought, "Why not have both Coke and Pepsi and let the customer decide?" I am not sure whether there was a pricing issue that prevented management from buying both—like the loss of a discount for going Coke-only or whatever.
Of course you always saw signage, etc. around the restaurant with Pepsi logos (or Coca-Cola logos at other restaurants) so you knew there were gifts in other forms that one of the two would entice the owner with.
What a slow growing up I have gone through since then. It seems like the kind of thing they ought to teach in primary education.
kotaKat|2 months ago
I'm a habitual enough soda drinker that I'm a six-pack-a-day diet soda drinker (don't judge me, at least it's not Red Bull). I notice that there's vendor collusion at Walmart for months at a time where the Pepsi six-packs will typically go on sale for a few months at a sub-$4 to $5 price (currently it's $4.98) while Coke packs will be $5-6 off sale.
Cycle three to four months and Coke will enter the $4 position and Pepsi goes back up to a full retail price for the next quarter.
I've always seen the 'cycle' of the two competitors constantly hitting a 'sale' price across various retailers.
foxyv|2 months ago
Even weirder, the drinks that I flavor myself taste way better than the ones in the store. I suspect they have been titrating their flavoring down over time. Root Beer I make myself using drink powder tastes way better than the ones from the store. Same for grape and orange sodas.
antonymoose|2 months ago
Sadly for this RedBull drinker, they never go on sale, at all, ever, anywhere.
everdev|2 months ago
Our country and civilization is slowly turning into organized crime.
dominicrose|2 months ago
hasbot|2 months ago
camgunz|2 months ago
unknown|2 months ago
[deleted]
agentifysh|2 months ago
hackthemack|2 months ago
https://waldenconsultants.com/2020/04/13/yet-another-study-s...
https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
xrd|2 months ago
codingrightnow|2 months ago
whamlastxmas|2 months ago
foxyv|2 months ago
tencentshill|2 months ago
scentoni|2 months ago
GenerWork|2 months ago
I hate to say it, but was he proven wrong? People are still buying junk food and soda (their primary products) despite prices going up. Looking at Pepsis profit margin, it seems to have hovered between 9.5% and 10.5% since 2021.
janalsncm|2 months ago
And even if people buy a lot of junk food, they might have bought competitors’ junk food. Laws are still laws even if you don’t like the people the laws protect.
jimt1234|2 months ago
First, that made me raise an eyebrow.
> ...and failed.
Then, that made me laugh.
> And now there’s a political and legal storm as a result.
Finally, that made me sigh, because nothing's gonna happen. The "storm" will pass, as it always does.
codingrightnow|2 months ago
MagicMoonlight|2 months ago
JKCalhoun|2 months ago
Why? Unless there was some kind of payola, this is doesn't make sense.
janalsncm|2 months ago
nitwit005|2 months ago
But, beyond that, while logically voters should vote against politicians that favor businesses over them, they often appear to do the opposite. They simply gain the label of "business friendly".
WolfeReader|2 months ago
Capitalism in practice: a relative handful of rich people cooperating with each other to extract as much money as possible from the middle and lower classes.
You can see which version of capitalism this document supports.
The "fiscally conservative" aspect of the Republican party (and the Democratic party to a lesser degree) don't want people to think of capitalism-in-practice; they want happy consumers who think that competition is still a thing. Since this document clearly goes against that narrative, it must be suppressed.
anigbrowl|2 months ago
unknown|2 months ago
[deleted]
hasbot|2 months ago
xrd|2 months ago
[deleted]
poppafuze|2 months ago
[deleted]
lanfeust6|2 months ago
[deleted]
digital-cygnet|2 months ago
> As a result of Food Lion threatening Walmart’s price gap, Pepsi created a plan to nudge Food Lion’s retail prices on Pepsi products upward by reducing promotional payments and allowances to Food Lion and raising other costs for Food Lion
mc32|2 months ago
[deleted]
citizenkeen|2 months ago
Pretty sure oatmeal is a nutritional foodstuff.
twoodfin|2 months ago
If it were to be enforced uniformly and aggressively it would be devastating: Every negotiation between a supplier and a purchaser at every level is potentially a federal crime!
If it were to be enforced capriciously, it would put unchecked power over everyday commerce—again at every level—into the hands of the FTC and its political masters.
No thanks. Repeal it so we can stop hearing about this “one neat trick to roll back neoliberalism!”
therobots927|2 months ago
GuinansEyebrows|2 months ago
theLegionWithin|2 months ago
nitwit005|2 months ago
hereme888|2 months ago
levocardia|2 months ago
darth_avocado|2 months ago
taurath|2 months ago
They write the rules.
recursivecaveat|2 months ago
JKCalhoun|2 months ago
jazzyjackson|2 months ago
cowpig|2 months ago