Retailers come under scrutiny in Europe

07 July 2010

BRUSSELS: The European Commission is placing retailers in member states under heightened scrutiny, as it seeks to review areas ranging from the cost of products to companies' online strategies.

Among the matters attracting the organisation's attention are the price differences between member states, energy consumption, relationships with suppliers and even traffic flow to and from stores.

In just one example of how these issues are playing out in practice, the institution found there was a 28.4% difference in the bill for buying food and non-alcoholic drinks in the Netherlands and Belgium.

More broadly, the Commission stated it was perturbed by "a lack of growth in e-commerce" and a "lack of information and transparency on pricing."

While multinational giants like Tesco and more niche players such as Abercrombie & Fitch have embraced the opportunities afforded by the web, this has not been the case across the region as a whole.

In the UK, for example, online retail should account for 10% of category sales by 2012, according to projections from payment services provider PayPal.

However, the Commission suggested this channel currently holds a market share of 2% or more in just four of the nations under its remit.

Such regional inconsistencies are hampering the development of a single European market for goods and services, especially given that shoppers are often unwilling or unable to buy goods across borders.

The Commission is currently receiving responses from retailers and expects to publish its report later in the year.

Data sourced from Wall Street Journal; additional content by Warc staff