FTC Seeks Supply Chain Data From Suppliers, Big Box Retailers

The agency wants to understand what’s causing the bottlenecks and isn’t accusing the firms of wrongdoing.

December 01, 2021

Shipments on ships

ALEXANDRIA, Va.—The Federal Trade Commission has asked nine companies, including Tyson Foods Inc., McLane Co. and Walmart Inc., to provide the agency with information surrounding their operations as part of a fact-finding effort to understand ongoing supply chain disruptions.

The orders, which were announced Monday, also are being sent to Amazon.com Inc., Kroger Co., C&S Wholesale Grocers Inc., Associated Wholesale Grocers Inc., Procter & Gamble Co. and Kraft Heinz Co. The companies will have 45 days from the date they received the order to respond. The FTC hasn’t accused the companies of any wrongdoing.

“Supply chain disruptions are upending the provision and delivery of a wide array of goods, ranging from computer chips and medicines to meat and lumber,” FTC Chair Lina M. Khan said in a statement released by the agency.

The Biden Administration and other analysts have pegged lack of competition in the supply chain as one of the main causes for inflation. The FTC said that supply chain disruptions are "causing serious and ongoing hardships for consumers and harming competition in the U.S. economy."

“We’ve had an incredible amount of consolidation in the supply chain. ... That’s why it’s been unable to withstand the kind of shock we’ve seen with the pandemic,” Diana Moss, president of the American Antitrust Institute, told The Washington Post.

The goal of the FTC study is to “shed light on market conditions and business practices that may have worsened” the supply chain.

The FTC said the companies are required to “detail the primary factors disrupting their ability to obtain, transport and distribute their products; the impact these disruptions are having in terms of delayed and canceled orders, increased costs and prices; the products, suppliers and inputs most affected; and the steps the companies are taking to alleviate disruptions; and how they allocate products among their stores when they are in short supply.”

Companies also are required to provide the FTC with "internal documents regarding the supply chain disruptions, including strategies related to supply chains; pricing; marketing and promotions; costs, profit margins and sales volumes; selection of suppliers and brands; and market shares."

With its supply chain study, the commission will need to distinguish between price increases that reflect the workings of supply and demand and those that result from improper business links, a former FTC official told the Washington Post.