Three big supermarkets in the United States raised their prices during the pandemic and made huge profits

During COVID-19, Walmart, Amazon and Kroger raised their prices to make up for the additional costs resulting from this health crisis (OP Morales/Infobay)

A recent report from federal trade commission from the United States (ftc) revealed that during the pandemic COVID-19Retail giants like wal-mart, Amazon And kroger They took advantage of supply chain disruptions to significantly increase their prices, overcome additional costs arising from contingencies, and reap huge profits.

This behavior not only harmed smaller competition, but also forced consumers to face higher food prices and shortages of staples like toilet paper.

The FTC report said that during the pandemic, the response of these corporations demonstrated how strategies to ensure their market dominance have exacerbated existing supply chain problems, leading to “pressure on the supply chain despite reduced profits.” More remains”.

According to the document, published by Yahoo! newsThese companies with larger market shares “accelerated and distorted” the negative impacts associated with the supply chainWhich has a direct adverse impact on consumers and the economy as a whole.

Big chains impose strict delivery requirements on their suppliers (OP Morales/Infobay)

According to the document, these large retailers put undue pressure on their suppliers to ensure access to scarce products, causing significant competitive disadvantage to smaller companies, particularly those in the food retail sector.

The tactics adopted by these major corporations included imposing strict delivery requirements and threatening large fines on suppliers who failed to fulfill requested orders, which allowed these companies to take over. “Effectively gain competitive advantage over smaller rivals”,

The analysis came after an order issued by the regulatory agency in late 2021, in which it requested “detailed information” To examine the reasons behind the challenges faced by various corporations. the supply chainas well as how competitive business practices may exacerbate these disruptions.

“The findings show how barriers the supply chain Markets may face significant shocks the supply chainAnd that these shocks may, in turn, allow larger companies to consolidate their dominance,” said ftc,

Food and beverage retailers’ revenues increased significantly in 2021 (OP Morales/Infobay)

The research also showed that food and beverage retailers’ revenues increased significantly, reaching more than 6% of total costs. in 2021A figure which is significantly higher than the previous peak of 5.6% recorded in 2015, This growth accelerated even further in the first three quarters of 2023, where profits reached 7% on total cost,

The National Grocers Association (NGA), representing small independent food retailers, welcomed the FTC study. NGA CEO Greg Ferrara said the report “confirms what independent retailers and their customers experienced firsthand.”

He said ferrara To USA Today, Major national chains, or so-called “Electricity Buyer”Are “Abuse of one’s immense economic power” To the detriment of both competition and American consumers.

FTC report highlights national chains’ abuses of economic power (OP Morales/Infobay)

in 2022 wal-martlargest retail chain usaLed the sector with sales reaching $400 billion, which translated into operating profit of $21 billion.

With a total revenue of $242 billion in product sales and $271 billion in service sales, Amazon was also not far behind in firmly establishing itself as a leader in the field of e-commerce. Amazon reported total operating income of $12 billion.

Kroger emerged as the largest chain in the supermarket sector, reporting sales of $148 billion and operating profit of more than $4 billion.

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