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Lecture 10

SOC 2080 Lecture Notes - Lecture 10: Natural Farming, Chain Store, Vertical Integration

Course Code
SOC 2080
Anthony Winson

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SOC*2080 WEEK 5
Intimate Commodity
Consumers pay for shelf space
o Cost is in the products
o More costly for everyone
o Supermarkets separate the rent for their space from the process
Natural Farming Video
US government
o Says it’s usaitary to ut up eat outdoors
Food Retailers: The Real Power in the Agro-Food Complex
Impact of the depression
o Devastating hit the independent food retail operations hard
o Few companies that were able to capitalize the situation, started to expand
Store chains, supermarkets, and supermarket chains
o Early in 20th century bought independent store, had control in a range of shops
o Absorbed the wholesale dimension of food
Extracted profits for their private interests
o Chain store operation dramatically increased
o A type of store that brought everything together ea, dry goods, self sere, did’t hae to ask a
grocer for your products
Supermarket separate phenomenon
o Linked the chain concept and supermarket concept together very powerful
Influential post WWII
By 1948 grocery chains have 34% of grocery sales in the US
o Ex. Meat stores chains developing selling meat
One company would buy an independent meat store and run under a banner of the chain
o Controlled over a third of grocery sales well developed
NOT the supermarket
By 1982 they have 62% of grocery sales
What makes retailers powerful? CONCENTRATION
o Especially in Canada and Britain
By 1987 top 5 grocery chain stores have 70% of sales in Canada (in US only 24%)
o US in food, banking and other sectors, they have lower levels of corporate concentration
What is the impact for Canadians?
Market much more concentrated in Canada
o More concentrated today
Two largest firms with > 50% of sales
Concentration at the local/metropolitan level greater than national level
o Leel of oetratio is the ig fator ut there’s other oes as ell
What else makes them powerful?
o Horizontal and vertical integration
The Western Empire: from baking empire to food retail empire
o Sales 2010 - $31,000,000,000
o Gross profit - $7.6 billion
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