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Sainsbury's Competition Policy Essay

556 Words3 Pages

Competition policy defines government policies to avoid and decrease the abuse of monopoly power. The reason of reducing the abuse of monopoly power is because it can lead to market failure and be against the public interest. (Tejvan, n.d.) The primary objectives of competition policy are to improve markets work and contribute towards improved efficiency in and enhanced competitiveness of UK businesses within the European Union. Example of competition policy is Competition Act 1998 and Enterprise Act 2002. Competition Act 1998 is an act to make provision about competition and has the abuse of a controlling position in the market. The benefit of Competition Act 1998 is low prices for consumers as it is the easiest way for businesses to gain a high market share when businesses offer a better price. For example, …show more content…

Besides, Sainsbury’s can provide a better service and friendlier customer service to customers so that it can satisfy customer needs and wants. Furthermore, businesses should have to offer more choices for customers to survive in a competitive market. For instance, Sainsbury’s has provide varieties of products such as groceries, clothing, shoes, mobile phones and so on to let customers to get most of the products they need in their store. Sainsbury’s can also import unique brands from different country which resulted in a greater choice for customers to choose the products that is most suitable for them. The restriction of Competition Act 1998 is it will cause abuse of market power and lead to market failure. For example, abuse of market powers will occurs when business that has a large share of the market consists of monopoly power to set higher prices of the products and services, it will cause customers do not have the ability to purchase, therefore market failure

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