Major supermarkets are using 'confusing and misleading pricing and promotional practices' which in some cases could breach consumer law, a three-month investigation by the UK's competition watchdog has concluded.
The Competition and Markets Authority (CMA) found evidence of 'poor practice' such as unclear unit pricing and 'was/now' offers where the discount price is advertised as a promotion for longer than the higher price applied – though it concluded the problems were 'not occurring in large numbers across the whole sector' and said retailers were taking compliance seriously.
It is also recommending that the Chartered Trading Standards Institute clarifies the legislation around promotional practices in its 'Pricing Practices Guide', and that the Department for Business, Innovation and Skills (BIS) publishes best practice guidelines on unit prices when goods are on promotion. A unit price is a labelling system that displays the cost of different products by weight or volume.
In addition, the CMA has issued its own guidance on unit-pricing for consumers so they can compare prices of groceries regardless of the different weight or volume.
Enforcement action could also take place if the CMA finds any breach of consumer law.
'Still areas of poor practice'
Nisha Arora, CMA senior director for the consumer sector, says: "We have found that, whilst supermarkets want to comply with the law and shoppers enjoy a wide range of choices, with an estimated 40% of grocery spending being on items on promotion, there are still areas of poor practice that could confuse or mislead shoppers.
"So we are recommending further action to improve compliance and ensure that shoppers have clear, accurate information."
'Super-complaint' submitted to the CMA
The investigation follows a 'super-complaint' (this gives an organisation special status to say whether a market is failing consumers) from consumer group Which?, following "concerns about confusing and misleading promotions and a lack of easily comparable prices".
Which?, for example, found that a two-litre bottle of Pepsi Max was advertised at £1.98 for 28 days, but then on a £1 "was £1.98" offer for 63 days.
In other instances it found that some sauces in supermarkets were priced per 100ml and others per 100g, making it impossible for customers to make price comparisons.