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It’s old news that Jersey consumers are paying a third more for groceries than the cheapest UK retailer – so, if that's the case, what can we do about it?
The Jersey Competition Regulatory Authority this week published its final report, which found that while prices in Jersey are higher than in other jurisdictions, the market is working, and suppliers are not making excessive profits.
A draft report was published for consultation in June. However, no changes were made following responses submitted by the Jersey Consumer Council, Channel Islands Coop, and Public Health Jersey.
Pictured: A breakdown of the JCRA's final report.
Peter Hetherington, Chief Economist at the JCRA said that "competition in the Jersey grocery market is working".
He explained: "Grocery suppliers are not making excessive profits, and comprehensive survey data indicates that Jersey customers are well served by the market.
"Higher on-island operating costs and the lack of low-price suppliers, however, do mean that Jersey consumers are paying more for their groceries.
"Nonetheless, our report does set out recommendations for policy makers to further support the competitive process and consumers."
These three recommendations, which the JCRA will now work to support, are:
Improving price transparency with investment in Jersey Consumer Council's price comparison service, to encourage greater price-based competition.
Maintain a competitive and dynamic groceries market, by minimising entry barriers, such as planning, and promoting Jersey as a testbed for innovation.
Follow up recommendations from the JCRA's market study into freight logistics, to increase competition and reduce freight costs.
In its response, the Coop said: "We acknowledge the findings that operating locally can be costly, and it is essential for these costs to be appropriately reflected in local retail pricing.
"However, we also recognise that the presence of a consumption tax on basic foods contributes to the disparities in retail pricing when compared to the UK where basic foods are VAT exempt."
GST, the Coop stressed, can also hike up prices.
Pictured: Mark Cox is CEO of Coop Channel Islands. (Dave Ferguson)
The Coop urged "some caution" in price comparisons, explaining that "the difficulties in conducting price comparisons for grocery items are numerous".
The supermarket cited the different sized packaging, variation in unit pricing, promotions and loyal programs, and "potential variation in prices based on the location of the grocery store".
They added: "While we support the recommendation for improved price transparency, we propose that any service providing such comparisons should be obligated to adhere to set standards. This will ensure that consumers receive accurate and reliable data, free from misleading information that could lead to uninformed purchasing decisions."
Public Health Jersey described affordability as a "key consideration for islanders in making dietary choices", adding that they would "strongly support improving price transparency on produce" so that islanders "can more easily identify affordable healthy, nutritious options for their diet".
They added that this would including "removing barriers for smaller scale enterprises, such as farm shops selling fresh local produce" to ensure that "these producers can promote their prices and on-island food production".
Public Health also suggested that the price comparison service be "accompanied by more information on the nutritional content of products" to ensure that islanders are "alerted when food products contain high levels of sugar, salt and fat which have a detrimental impact on their health".
"In addition, the service may benefit from an extended range of healthier goods for comparison," they added.
Pictured: Carl Walker is Chair of the Jersey Consumer Council, who created PriceComparison.je to allow islanders to compare prices.
Carl Walker, Chair of Jersey Consumer Council, said that "with additional funding, Jersey Price Comparison could be developed and enhanced, and the range of products and local stores surveyed could be increased".
He added that the JCC could "look at the possibility of comparing prices to other jurisdictions, such as the UK", as well as "carrying out more regular surveys of other products and services" such as the cost of GP fees, dentist fees, car services, funeral costs and other essential services.
Mr Walker said: "With groceries, fuel and oil continuing to rise, we believe it is more important than ever that we continue to offer Islanders a reliable and regular Price Comparison service. We routinely see individual items range significantly in price from store to store.
"And, while Islanders can often get a feel themselves of which supermarkets are on the more expensive side, we're able to provide them with actual data to back that up – and consumers often tell us that they're surprised to see which stores have certain products at the lowest price, as it's not always the ones they expect.
"The Jersey Consumer Council may not be able to control pricing, but by highlighting price differences, and letting Islanders know where items are currently cheapest, or most expensive, we can help them to vote with their feet, and to buy from those retailers who consistently offer the best prices."
Coop said that "reducing entry barriers, such as planning and labelling requirements, can foster a more competitive and dynamic grocery market" – but added: "That said, we believe that entry barriers are relatively low and there are opportunities for competition to enter the market should they wish to do so."
"All local retailers have to contend with a number of issues which are systematic of doing business within a small island which undoubtedly add cost to the operation of the business and come with the added complications of different regulatory, licensing and compliance requirements," they explained.
Public Health suggested that "improving routes to markets for local food producers could sustain local production", adding that "improved access to food outlets" could be "addressed through changes in opening hours and increases to the number of food outlets, for example extending the range of community grocery and farmer markets".
Pictured: Jon Hackett, who owns Brooklands Farm in St. Brelade, recently received planning permission to extend the opening hours of his farm shop following an outpouring of public support.
Competition regulation should be used "to improve access to affordable, healthy nutritious foods that are sustainably produced", they added.
"Islanders report finding it difficult to eat healthy, good quality, affordable food as part of their daily diet, and this is negatively impacting their overall health and wellbeing.
"Public Health Jersey would support and embrace any opportunities to partner with the JCRA to address these challenging and urgent priorities."
The Coop said that improving freight logistics services is "essential for enhancing the overall grocery market".
They explained: "By reducing freight costs for Jersey retailers, businesses can potentially lower their expenses and pass on the savings to consumers, leading to lower grocery prices.
"Implementing these recommendations can create a more efficient supply chain and contribute to a more competitive market landscape."
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