Nike, Adidas Face Cartel Probe After Axing Supply To Small Shops
A decision by Nike and adidas to "supply only major outlets has been referred to a government anti-cartel unit," according to Benedict Moore-Bridger of the London EVENING STANDARD. Small independent retailers "rely on the brands to attract customers," and said that without them "they could be forced to close." London 2012 sponsor adidas and Nike, which sponsors the England football team, "no longer supply outlets" which sell less than £25,000 ($41,000) worth of their products a year. The move "has been roundly criticised," with former Olympics Minister Tessa Jowell "urging the two companies to reconsider." The Office of Fair Trading’s cartels unit "has now been asked to investigate the decision, which small businesses say is 'cutting off their lifeline.'" Investigators "may examine whether Nike and adidas’s behaviour could be in breach of the Competition Act or Article 81 of the EC Treaty," or whether a criminal offense under the Enterprise Act "has been committed." Nike claims that the move is "intended to cut costs and improve consumer experience," while adidas said that supporting small shops was "not efficient" (EVENING STANDARD, 1/9).