Abstract

In the face of renewed public interest in antitrust enforcement, two of the largest U.S. supermarket operators announced merger plans in October 2022. The proposed fusion of two companies selling similar arrays of essential products, with over 5,000 stores and 700,000 employees between them, would seem to offer a tempting target for trust busters. But over the past century, the formerly prosaic sector once known as grocery retailing has reinvented itself repeatedly, in ways that will make it difficult for competition authorities even to define a relevant market, much less to quantify the anticipated impact of the merger on prices. Further, structural changes in manufacturing and distribution, notably the diminishing number of independent wholesalers, increasing sales of private brands, and the growing importance of information about customer behavior, may favor concentration in the future regardless of whether this merger proceeds. The paper will evaluate corporate strategies in food retailing over several decades, as well as extensive historical market data, to consider this rapidly changing industry in the context of U.S. antitrust law.