In the world of grocery marketing, shelf space and position are critical. Critics say slotting fees curb fair access to the market and erode consumer choice. Big companies are able to use their big bucks to keep competitors' products off the supermarket shelf. And many small producers can't afford the high slotting fees and are relegated to low-traffic specialty stores and the corner market. These are all costs that get passed along to the consumer in the form of higher prices.
Stores can charge a company to remove a dud product or order a manufacturer to buy it back.
Manufacturers are reluctant to blow the whistle on slotting fees, fearing retribution from chain retailers and dominant manufacturers. When a US Senate committee conducted hearings on the grocery industry, many producers refused to make any public comments even when offered anonymity. Those that testified did so behind protective screens and used a voice scrambler to conceal their identities. While the FTC and the American Senate are able to launch wide-ranging inquiries into an entire industry, Canada's Competition Bureau cannot. He explains this authority was stripped away in 1986 in amendments to the Competition Act.