I see the Tories are planning to ban loss-leading in the off trade if they gain power next year. “Shadow licensing minister Tobias Ellwood has said the Tories will ban supermarkets from selling alcohol as a loss leader if they get into power.”
Setting aside the obvious administrative burden of establishing that nothing is being sold at a loss, I think people would be surprised how little difference it made. The extent of loss-leading in supermarkets even now is far less than many imagine – I would be amazed if it accounted for more than around 2% of all alcohol units sold. Most of those keen prices come from driving a hard bargain with suppliers, and if loss leading was banned the retailers would simply turn the screw further to make suppliers fund more of the promotions.
Given that you can’t pass a law to say that no business can trade at a loss, you can’t ban loss leading by the people who actually make the stuff. And would it become illegal to sell off surplus or short-dated stock below the wholesale price? If so, retailers might well become much more reluctant to stock anything that might represent a bit of a risk - or force producers to supply it on a sale-or-return basis.
Banning loss-leading stands alongside minimum pricing as another delusional panacea that in practice would bring no discernible benefit for the on-trade.
And yet more evidence that a Tory election victory won’t really make much difference.