Supermarkets blamed for Spanish store wars

Small store operators in Spain have seen their share of everyday household good sales - including food and drink - drop by 50 per cent since new regulations governing the retail trade were introduced in 1996.

But, according to Anged​, the association which represents the major retail groups in Spain, it is not the huge hypermarkets which are to blame for the steady decline of the small store sector - it is supermarkets.

Anged claims that the 1996 regulations imposed very tight restrictions on hypermarket development but very little on supermarkets, with the result that these medium-sized stores have proliferated at the expense of smaller retailers.

According to a report in the Cinco Dias​ newspaper, Anged said that this showed quite clearly that the law had failed in its primary objective - to protect Spain's small, often independent retailers from the superior buying power of the major chains.

In addition, it has hampered investment and job creation in local communities, and by restricting the growth of hypermarkets, has in fact ensured that prices are kept artificially high, penalising rather than protecting consumers.

The report cites Anged as saying that "business policy should not, as we have seen it do up until now, restrict competition among retailers which are popular with consumers but rather improve the competitiveness of those which are losing market share"​.

Anged was responding to the latest figures which suggest that some 51,600 small retailers are likely to close and some 100,000 jobs will be lost when the next phase of Spain's retail and wholesale legislation, covering the liberalisation of store opening hours, comes into force in 2005.

The association is also calling for a revision of the existing legislation, seeking the same treatment for both hypermarkets and supermarkets, and making it easier for retail groups to gain approval for new store developments across the country.