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Premier Foods - Are they exploiting their monopsony power?

Geoff Riley

5th December 2014

Pay and stay - is this an unfair, exploitative example of the monopsony power of a giant food business over their suppliers? Or a suitable strategy for a company looking to trim their list of suppliers and build longer-term commercial relationships? On the surface it doesn't look good, perhaps the tip of the iceberg in food and drinks industries where suppliers are pathetically dependent on mass-volume food manufacturers for sales?

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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