5 ms·

If it makes you happy we can add in ".. except for soaps" in the ruling... /s For a real life example, the major grocery chain in Australia (Woolworths) did th

If it makes you happy we can add in ".. except for soaps" in the ruling... /s For a real life example, the major grocery chain in Australia (Woolworths) did this with milk, selling their brand for $1 a litre, where everyone else had to do $2+ just to break even. Effectively selling it at a loss so that they get market dominance. They make up the loss on other products in their big chain. I think there needs to be a break-up between "the retailer" and their home brand being sold there, because it means the profits made on selling the competition works to the home brand advantage.

granzymes 3y ago
And in Australia today is Woolworths a monopoly, or are there still other companies in the market selling milk? I think I can guess.
- drekipus 3y ago
  The consumer protection body got involved as well as a lot of negative media attention. They had to raise their prices so they don't become a monopoly. Did you guess "there needs to be market regulation and monitoring?" Because: Bingo! You got it!
  - granzymes 3y ago
    Really? Because the reporting I found says that the competition authority cleared the market participants of any wrongdoing in the "milk wars". >[Chairman of the Australian Competition and Consumer Commission] Samuel said the major impact of discounted milk prices appears to have been a reduction in the supermarkets’ profit margins on house brand milk, rather than a gain. https://www.smartcompany.com.au/startupsmart/advice/startupsmart-legal/accc-clears-coles-of-predatory-pricing-of-house-brand-milk/ https://www.smartcompany.com.au/startupsmart/advice/startups...
    - drekipus 3y ago
      How is that different to what I said? > "Effectively selling it at a loss" Sure, maybe it wasn't a total loss, just less profit.
      - granzymes 3y ago
        >The consumer protection body got involved as well as a lot of negative media attention. >They had to raise their prices so they don't become a monopoly. You seemed to be suggesting that what was happening with milk was anticompetitive and the consumer protection body got involved to stop it. I pointed out that what actually happened is that the body determined that there wasn't anything anticompetitive going on and that the companies ceased the "milk wars" on their own because they were losing money (which is exactly what I was alluding would happen with soap if one company tried to drive competitors out of the market). Seems like a big difference to me.
scarface_74 3y ago
Every retailer has loss leaders.
- kalleboo 3y ago
  Loss leaders are illegal in several countries
  - scarface_74 3y ago
    Well since this a US lawsuit…
- barrkel 3y ago
  Illegal in California...
  - deleted 3y ago
    [deleted]
  - scarface_74 3y ago
    Three conditions must be met. https://www.upcounsel.com/lectl-california-antitrust-law https://www.upcounsel.com/lectl-california-antitrust-law > Loss Leader Sales > The Act also bars "loss leader" sales, defined as sales (1) below cost, (2) to induce, promote or encourage the purchase of other merchandise, and (3) with the intent to injure competitors or destroy competition. Business and Professions Code 17044. If that were not the case, cell carriers couldn’t sell phones below cost to sell service plans and the entire “razor vs razor blades” model would be illegal. That also means that game console sales would be illegal.
    - jjeaff 3y ago
      how would you prove intent to injure a competitor? wouldn't all attempts to outcompete a competitor be considered an attempt to injure them? there is no way Costco isn't losing money on their $4.99 chickens or $1.50 hot dog and drink. and I assume the point is to get you in the door so you will buy other stuff from them and not Amazon or Walmart.
mullingitover 3y ago
When your competitors are dumping, can’t you just buy their goods and resell them at cost until they go broke?
- DecoPerson 3y ago
  Not without potentially creating a scandal. “IGA coordinates anti-consumer buyout of Woolworths milk” “Why is IGA skimming your milk?” “Woolworths vs IGA — Calf scalps bull’s milk”
- nickpp 3y ago
  That is exactly what Dow Chemical did at the beginning of the 20th century to break the German bromine cartel. https://en.wikipedia.org/wiki/Herbert_Henry_Dow#Breaking_a_monopoly https://en.wikipedia.org/wiki/Herbert_Henry_Dow#Breaking_a_m... No government intervention necessary!
thejazzman 3y ago
Huh, kinda like the App Store sparing Apple/Google of fees while all their competitors eat 30% cut to their revenue

granzymes 3y ago

And in Australia today is Woolworths a monopoly, or are there still other companies in the market selling milk? I think I can guess.

drekipus 3y ago
The consumer protection body got involved as well as a lot of negative media attention. They had to raise their prices so they don't become a monopoly. Did you guess "there needs to be market regulation and monitoring?" Because: Bingo! You got it!
- granzymes 3y ago
  Really? Because the reporting I found says that the competition authority cleared the market participants of any wrongdoing in the "milk wars". >[Chairman of the Australian Competition and Consumer Commission] Samuel said the major impact of discounted milk prices appears to have been a reduction in the supermarkets’ profit margins on house brand milk, rather than a gain. https://www.smartcompany.com.au/startupsmart/advice/startupsmart-legal/accc-clears-coles-of-predatory-pricing-of-house-brand-milk/ https://www.smartcompany.com.au/startupsmart/advice/startups...
  - drekipus 3y ago
    How is that different to what I said? > "Effectively selling it at a loss" Sure, maybe it wasn't a total loss, just less profit.
    - granzymes 3y ago
      >The consumer protection body got involved as well as a lot of negative media attention. >They had to raise their prices so they don't become a monopoly. You seemed to be suggesting that what was happening with milk was anticompetitive and the consumer protection body got involved to stop it. I pointed out that what actually happened is that the body determined that there wasn't anything anticompetitive going on and that the companies ceased the "milk wars" on their own because they were losing money (which is exactly what I was alluding would happen with soap if one company tried to drive competitors out of the market). Seems like a big difference to me.

scarface_74 3y ago

Every retailer has loss leaders.

kalleboo 3y ago
Loss leaders are illegal in several countries
- scarface_74 3y ago
  Well since this a US lawsuit…
barrkel 3y ago
Illegal in California...
- deleted 3y ago
  [deleted]
- scarface_74 3y ago
  Three conditions must be met. https://www.upcounsel.com/lectl-california-antitrust-law https://www.upcounsel.com/lectl-california-antitrust-law > Loss Leader Sales > The Act also bars "loss leader" sales, defined as sales (1) below cost, (2) to induce, promote or encourage the purchase of other merchandise, and (3) with the intent to injure competitors or destroy competition. Business and Professions Code 17044. If that were not the case, cell carriers couldn’t sell phones below cost to sell service plans and the entire “razor vs razor blades” model would be illegal. That also means that game console sales would be illegal.
  - jjeaff 3y ago
    how would you prove intent to injure a competitor? wouldn't all attempts to outcompete a competitor be considered an attempt to injure them? there is no way Costco isn't losing money on their $4.99 chickens or $1.50 hot dog and drink. and I assume the point is to get you in the door so you will buy other stuff from them and not Amazon or Walmart.

mullingitover 3y ago

When your competitors are dumping, can’t you just buy their goods and resell them at cost until they go broke?

DecoPerson 3y ago
Not without potentially creating a scandal. “IGA coordinates anti-consumer buyout of Woolworths milk” “Why is IGA skimming your milk?” “Woolworths vs IGA — Calf scalps bull’s milk”
nickpp 3y ago
That is exactly what Dow Chemical did at the beginning of the 20th century to break the German bromine cartel. https://en.wikipedia.org/wiki/Herbert_Henry_Dow#Breaking_a_monopoly https://en.wikipedia.org/wiki/Herbert_Henry_Dow#Breaking_a_m... No government intervention necessary!

thejazzman 3y ago

Huh, kinda like the App Store sparing Apple/Google of fees while all their competitors eat 30% cut to their revenue