Clear the air

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Six months ago, a senate hearing on "slotting" payments to retailers generated some riveting allegations of abuse. Now the Federal Trade Commission has stepped in with plans to hold a public "workshop" on slotting. This is an opportunity to let some sunlight in on a legitimate part of the marketing system -- or a spur to clean house, if that's what's needed. Either way, let's hope it clears the air.

The stars of last September's Senate hearing were witnesses who testified only when their true identities were hidden for fear of retribution. They claimed the slotting fee system has become a barrier to smaller marketers unwilling to pay to get prime shelf space in stores, or unable to match what larger competitors pay retailers. The committee chairman, Sen. Kit Bond (R., Mo.), related unconfirmed tales of outright bribes sought by supermarket buyers who control shelf space. Wild talk? Uncorroborated? Yes. But prudent managers would be foolish to dismiss this out of hand.

No business likes to invite government scrutiny, and retailers, marketers and industry groups, of course, can balk at full cooperation with the FTC's workshop idea. There's no doubt some may be uneasy that the FTC's interest in the slotting fee system follows so soon after it alleged that spice marketer McCormick & Co. gave unfair discounts to some stores in exchange for shelf space. (McCormick, while admitting no wrongdoing, agreed to a settlement with the commission.)

The best counsel is to step forward to explain how slotting works today. If there is anything here to blush about, let alone hide, all the more reason for the industry to examine what it's doing.

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