Interests in the Supermarket and Grocery Store Industry: Resources, Coverage, and Organizing Costs

Introduction

The Supermarket and Grocery Store Industry worldwide currently faces public policy issues relating to Labeling Regulations, Food politics and Abuses of buyer power. This paper will explore the nonmarket activity of the three leading retail giants from this industry, namely Tesco PLC ($101.3b), Walmart ($72.2b) and Kroger ($96.5b) respectively. It will also focus on drawing comparisons between their lobbying efforts and those undertaken by the industry’s prime trade associations.

Nonmarket Activity among Interests in the Supermarket and Grocery Store Industry

All of the three leading enterprises within this industry have a significant amount of non-market spending. British retail juggernaut, Tesco PLC, boasts of $101.3 billion in revenue and employs 530,000 people globally.^1&2 This emphasizes its economic and personnel prowess in the nonmarket realm. Internationally, Tesco operates in 12 markets and in all the 39 counties (states) of the United Kingdom.³ Therefore, it has a strong geographic presence domestically. Moreover, Tesco is also a household favorite in the U.K and that allows the company to leverage its strong brand as a catalyst to rally favorable political impetus. In addition, Tesco also invests significantly in campaign spending and lobbying in order to garner greater political support.⁴

North America’s largest retailer, Walmart, recorded a revenue of $72.2 billion and employs 2.2 million people worldwide. Walmart has 8,500 stores in 15 countries, under 55 different names. In 2009, it generated 51 percent of its US$258 billion sales in the U.S. from grocery business and is said to employ 1% of the American working population, making it a very robust force to reckon on the political front.^6&7 To reinforce this stance, within the U.S.A, Walmart operates in all 50 states and the district of Columbia. As of 2013, Walmart invested $3.8 million in political contributions, of which $1.47 million went to candidates, with the remainder going to political parties.⁸ (Exhibit 1)

Fellow U.S retailer Kroger totals $96.5 billion in revenue, operates 2,435 stores and employs 343,000 individuals in 31 states of its home nation. Compared to Tesco and Walmart, Kroger’s human resource penetration within its parent country may seem fractional, but it is still considered relatively strong on a general industrial scale.⁹ Surprisingly and rather uncharacteristically, Kroger has also reduced its cumulative political spending with expenditure on lobbying amounting to a measly $200,000. However, in retrospect, while looking at historic data pertaining to Kroger’s political investments over the last decade, it is evidential to infer that the company has not only been cutting down on such expenses, but was never actually big on political spending.¹⁰ (Exhibit 2)    

The National Retail Federation (NRF) is the world's largest retail trade association and represents an industry that contains over 1.6 million U.S. retail establishments with more than 24 million employees and sales of $4.4 trillion, as of 2005.¹¹ All the three major global retailers discussed above are a critical part of this umbrella group, which saw political spending of $1.1 million⁵ this year. Intriguingly, the $3.5 million spent in 2012 eclipsed this amount. (Exhibit 3) Other significant food retail trade associations include ‘The Food Institute’, ‘Foodservice Sales & Marketing Association’ and ‘National Association of Convenience Stores’ among others.¹²

Conclusion

The analysis conducted in this paper has highlighted a consistent trend - Reduced spending in political activity and lobbying in the Supermarket and Grocery Store Industry, largely characterized by the fractional cut in expenditure exercised by the industry’s largest and most vital trade association as well as its leading players. (Exhibits 1,2&3) It is also conclusive to recognize this industry’s dense and geographically well dispersed human elements, as viable forces that have the power to attract political attention and bring about requisite changes, if necessary.

End Notes

1.       Tesco Company Stats: http://www.dailymail.co.uk/news/article-1319718/Tesco-numbers-Employs-472-000-people-makes-6K-minute.html

2.       Tesco Company Stats: http://en.wikipedia.org/wiki/Tesco

3.       Tesco Company Stats - Store dispersion: http://www.store-locations.co.uk/tesco/

4.       Tesco’s Lobbying activities: http://www.corporatewatch.org.uk/?lid=254

5.       NRF’s Lobbying activities: http://www.opensecrets.org/lobby/clientsum.php?id=D000000741

6.       Walmart Company Stats -Annual Revenue & Store dispersion: http://en.wikipedia.org/wiki/Walmart

7.       Walmart Company Stats - Employee data: http://www.statisticbrain.com/wal-mart-company-statistics/

8.       Walmart’s Lobbying activities

·         http://www.opensecrets.org/lobby/clientsum.php?id=D000000367

·         http://www.huffingtonpost.com/al-norman/walmart-lobbyists_b_3632526.html

9.       Kroger Company Stats: http://en.wikipedia.org/wiki/Kroger

10.   Kroger’s Lobbying activities: http://www.opensecrets.org/lobby/clientsum.php?id=D000027084

11.   National Retail Federation Info: http://en.wikipedia.org/wiki/National_Retail_Federation

12.   Major Food Retail Trade Associations: https://www.technomic.com/Resources/Links/

EXHIBIT 1

EXHIBIT 2

EXHIBIT 3