On October 28, Small Business Rising held a webinar on How Big Retailers Get Illegal Pricing Deals and How to Fight Back. More than 100 people—mostly small business owners—attended live. We were proud to co-host the event, along with 16 other members of the coalition.
Summary of the presentation
Stacy Mitchell, Co-Director of the Institute for Local Self-Reliance, explained how illegal pricing works. Giant corporations and chains like Walmart, Amazon, and Dollar General use their power over suppliers to demand lower prices and better terms—and ultimately to eliminate competitors and dominate markets. Small businesses who pay higher costs for goods are forced to charge higher prices, which means cost-conscious customers end up at the big box chains.
Stacy pointed out that price discrimination is illegal under the Robinson Patman Act, which passed in the 1930s in response to the emergence of the first large retail chains. The Act was successful: competition meant that communities and customers had choices, and it helped to hold down prices and generate innovation.
But the 1980s brought a weakening in anti-trust enforcement, and since, we’ve seen the market share of independent retailers decline. While the Biden administration brought renewed interest in enforcing Robinson Patman, that has lagged. For example, the Federal Trade Commission dropped a recent case against PepsiCo for giving illegal deals to Walmart.
Attorney Katie Van Dyck explained that the most obvious form of price discrimination is when businesses see a product retailing for a price lower than they can purchase it wholesale. Other terms that count as price discrimination include discriminatory payments for promotional allowances, rebate coupons, or marketing and availability of services such as discounted transportation or promotional materials.
There is action at the national and state levels to strengthen protections for independent local businesses. Legislators in states like Rhode Island are also considering state-specific laws that would prevent price discrimination. Last year, Rhode Island’s Lt. Gov. Sabina Matos backed legislation that would’ve strengthened local enforcement of the Robinson-Patman Act in the grocery sector. Brianna Walker, advisor to Cory Booker, shared information about the Fair Competition for Small Business Act, which would empower state attorneys general to go after big box chains for price discrimination.
Call to action
View a recording of the webinar.
If you have a story about price discrimination, share it with Small Business Rising. Your story will help us help fight for fair markets and policies that level the playing field for independent businesses.
