Supermarkets: Covered markets are a viable alternative

Covered Markets as an Alternative to Supermarkets

The argument presented here is applied to the four largest UK supermarkets. The argument is less relevant to discounters such as Aldi and Lidl. The discounters are similar to stallholders in covered markets as both sets of businesses save money on the presentation of food.

An outline of themes discussed in the video

UK supermarkets generally operate under an economic model of monopoly or oligopoly. This generally leads to higher prices for consumers. Higher consumer prices, in supermarkets, are needed so that money can be paid to the supermarkets shareholders. The shareholders benefit from the abnormal or excessive profit earned by the supermarkets.

Covered markets generally operate an economic model of perfect competition. This generally leads to lower prices for consumers compared to monopoly or oligopoly. The stalls operating in covered markets tend to be smaller businesses which make a ‘normal’ profit for (family) owners. Consumers, who shop at supermarkets, can be seen as donating money (through higher prices) to their shareholders. Supermarkets have been described as department stores with large food halls. However, such large stores generally offer higher prices to consumers compared to shops in covered markets.

There are notable covered markets in Newcastle upon Tyne, Oxford and Preston in the United Kingdom. The Preston example is relevant as it provides an example of how money and employment can be maintained inside a regional economy.

Also, before the Royal Mail was privatised, it would have been possible to use the UK post office network to sell fruit and vegetables. This would have offered another alternative to the supermarkets; which have specialised in out-of-town superstores which are frequently located far from population centres.

In Praise of Covered Markets

Supermarkets take profit out of their businesses to pay dividends to external shareholders. Market stallholders, generally, do not do this and therefore can offer lower food prices to consumers. These lower prices provide the justification for the continuation of covered markets. In traditional markets, investment can be made to food quality and safety if consumers are willing to pay for such improvements.

Covered Markets: Autonomy and Employment

There are two other benefits of covered markets. Stallholders are likely to have greater autonomy, as small business people, than workers in supermarkets. Also if profits are retained, within the business, then market traders can employ more people than supermarkets; given the same level of turnover.

Application to Newcastle upon Tyne

In a city the size of Newcastle upon Tyne, ideally, it could be possible to have 20 to 30 smaller covered markets as an alternative to the supermarkets. Ideally, additional retail capacity would be in the form of post offices, located at the heart of communities. These shops could sell additional fruit and vegetables to the public.


The local authority does not need to own and run the covered market(s). Instead the retail units would own the building on a commonhold basis so the retailers would determine how the market operates. The market shops would have the power to stop any strike action to prevent the Grainger Marker from being closed. The council would still have an important regulatory role in overseeing the food businesses.