FTC Announces Public Workshop on Slotting Allowances and Other Grocery Marketing Practices

The Federal Trade Commission will hold a public workshop at its Washington, D.C. headquarters on May 31 and June 1, 2000, to discuss issues relevant to the use of slottingallowances. The workshop will give the FTC staff and interested parties an opportunity to examine the appropriate antitrust assessment of slotting allowances and other grocery promotion practices. A notice announcing the public workshop will be published in the Federal Register shortly.

"Slotting allowance" typically refers to a lump-sum, up-front payment by a food manufacturer to have its products placed on supermarket shelves. The use of slotting allowances has grown significantly over recent years, resulting in considerable debate, yet relatively little is known about their impact on competition and consumers. The upcoming workshop will give the Commission the opportunity to learn about the nature of slotting allowances and to better assess whether they raise competitive concerns.

"In some circumstances slotting allowances are likely to be efficient or competitively neutral. In other settings, though, they may be anticompetitive. The planned workshop should help us in getting to the bottom of these issues," said FTC Chairman Robert Pitofsky in announcing the workshop. "By bringing together business persons, marketing experts, and antitrust practitioners, we hope to increase our understanding of slotting allowances and their public policy and legal ramifications."

The workshop is intended to facilitate a discussion between manufacturers and retailers, consumer groups, marketing experts, economists and lawyers. Some of the issues to be addressed at the workshop include:

• What are the different types of slotting allowances, and what prompts the use of one type rather than another?

• How do slotting allowances vary from other types of product promotion, and what circumstances lead to the use of slotting allowances rather than other types of product promotion?

• Do supermarkets keep, or pass on to consumers, the fees they receive as slotting allowances?

• If slotting allowances were prohibited, would that lead to material differences in the bargaining relationship between manufacturers and retailers - or would discounts to retailers simply take a different form? and

• What other types of grocery marketing practices - such as category management - may raise antitrust concerns? What are those practices and under what circumstances might they pose antitrust issues?

The workshop will be open to the general public. It will be held at the main FTC building, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580, in Room 432, and will run for a day and a half, beginning at 2:00 p.m. on May 31 and at 9:30 a.m. on June 1. The workshop will entail panel discussions as well as open discussions among attendees.

The Commission vote to publish the Federal Register notice announcing the public workshop was 5-0.

Copies of the news release and the Federal Register notice are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580; 877-FTC-HELP (877-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(FTC Matter No. P001201)