The very least retailers must do is hunt within their own companies for problems before federal sleuths show up. And they likely are coming, since Sen. Kit Bond (R., Mo.), the chairman of the Senate panel, made clear he will press for inquiries by any federal investigative agency that will listen.
The senator was a rapt listener to tales of slotting abuse told by small business witnesses whose identities were disguised out of fear of retribution. They claimed the fee system is relegating marketers unwilling to make the payments to a smaller and smaller share of total store space, and that even those small marketers willing to pay fees lose out when larger rivals offer bigger payments.
Though hardly proven, there was also the whiff of bribery in the air. Sen. Bond said he had heard tales of smaller marketers encouraged to win shelf space by offering to pay to paint a supermarket buyer's house, or pick up the lease payments on another store buyer's BMW. With so much at stake, retailer managers who hold the keys to getting on store shelves are people of influence, and some few may be tempted to profit from their position. Top managements can't afford complacency. Nor can marketers overlook the possibility that their managers may be offering improper inducements to retailers.
Slotting payments are a fact of life in much of retailing, but they corrode the marketing system if other forms of competition -- product benefits, pricing, marketing -- take a back seat to whichever company is willing to pay the most for shelf space. And the system certainly cannot be allowed to be the breeding ground for outright bribery. Smart store operators aren't blinded by the cash. Neither should they be blind to the consequences of the system. Sen. Bond says