Grocery shoppers may not be seeing the best deals available to them, according to Canada’s Competition Bureau.
The Bureau is investigating minimum advertised pricing (MAP) policies that can prevent retailers from advertising a product below a certain price. A retailer may still be able to sell a product for less in-store, but shoppers may not know about the lower price until they get there.
The investigation comes as Canadians continue to rely on flyers, websites and apps to compare grocery prices and decide where to shop.
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“The bottom line is: Minimum advertised pricing policies can make it harder for consumers to find deals and compare prices,” Anna Maiorino, a spokesperson for the Competition Bureau, told Money.ca.
Why don’t stores advertise the lowest price?
A minimum advertised price is the lowest price a retailer is permitted to show when advertising a supplier’s product. The restriction can apply to flyers, websites, apps, social media and other advertising.
The policy can be imposed by a supplier or negotiated between a supplier and retailer.
The important distinction is that MAP applies to the advertised price, not necessarily the price at which a product can be sold.
The Competition Bureau gives the example of a pasta product with a minimum advertised price of $2.99. A discount grocer might be prepared to sell it for $1.99, but if it cannot advertise that lower price, shoppers won’t know about the deal before deciding where to shop.
“That means consumers can’t shop around and won’t know that there might be a better price until they go in-store,” Jeanne Pratt, interim commissioner of competition, told CP24.
The Bureau says flyers, websites, apps and other promotions are important ways consumers compare grocery prices before deciding where to shop. They’re also an important way retailers compete for customers.
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So what can shoppers do?
The Competition Bureau says a retailer may be able to sell below the advertised minimum, but consumers may have no way of knowing that price without entering the store.
That means shoppers should treat advertised prices as a starting point rather than assuming they’ve found the lowest price available.
If you’re already in the store, check the shelf price before putting an item in your cart. A product that wasn’t featured as a sale item in a flyer or app could still be priced lower than expected.
It’s also worth comparing similar products rather than focusing only on the headline price. Unit pricing — such as the cost per 100 grams or per litre — can make it easier to compare different package sizes and find better value.
How to find the best prices
- Check the shelf price. Don’t assume the flyer or app price tells you everything about what the store is charging.
- Compare unit prices. Price per 100 grams, litre or another standard unit can make different package sizes easier to compare.
- Compare similar products. A lower sticker price doesn’t necessarily mean lower cost for the amount you’re getting.
- Use flyers and apps as a starting point. They can help you decide where to shop, but an advertised price may not reveal every discount available in-store.
The Competition Bureau’s investigation is still underway, so it’s too early to know how widespread minimum advertised pricing is across Canadian grocery stores or how much it affects the prices consumers actually pay.
For now, if you’re looking for the lowest price, check what’s actually on the shelf in-store.
The Bureau is currently seeking information from Canadian consumers, retailers and suppliers about their experience with minimum advertised pricing as part of its ongoing investigation into the practice.
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Steven Brennan is a freelance finance writer based in Vancouver, BC. He holds a BA and an MA from Maynooth University, Ireland. His work regularly appears at Canadian Mortgage Trends, Lowest Rates, Loans Canada and other Canadian and U.S. brands.
