SPRING 2022

40 THE DISTRIBUTOR’S

40 THE DISTRIBUTOR’S LINK Jim Truesdell James Truesdell is President of Brauer Supply Company, a distributor of specialty fasteners, insulation, air filtration, and air conditioning with headquarters in St. Louis. Mr. Truesdell is adjunct professor at Saint Louis University and Webster University. An attorney and frequently published writer, he is the author of “Total Quality Management: Reports From the Front Lines”. BIG TECH AND THE PURCHASING PROCESS Along with all the benefits which technology has brought to Americans, one of the most visible is the ability to secure products quickly on line and see them appear on your doorstep or loading dock in the next couple of days. Consumers are able to secure those “hard to find” items now within minutes of beginning an on-line search. It almost seems like magic. But---as this new purchasing channel becomes widespread, how do we insure that it won’t become a process totally controlled by a few powerful companies who monopolize the channel and squelch any competitor who raises his or her head? How do we make sure that competition survives to keep market pressure on all parties to uphold service levels and maintain competitive prices? This may have particular importance for trade wholesalers. This concern is being addressed by a bipartisan congressional group led by Senator Amy Klobucher (D) of Minnesota and Senator Tom Scott (R) of Arkansas who have recently introduced the Platform Competition and Opportunity Act, designed to make major tech companies demonstrate that proposed mergers and acquisitions are not anti-competitive. A similar bill from Democratic Representative Hakeem Jeffries of New York will be voted on in the near future. As can be expected, there is a lot of concern being raised by people and companies on both sides of the issue. CONTRIBUTOR ARTICLE Proponents of the legislation point to threats from domination of platforms by a few large companies that could include refusal to deal with rivals, restrictive contracting, predatory pricing and excessive barriers to entry in the marketplace. Significant opposition exists from those who fear that this and other related measure are too broad, could serve to block innovation, or might hamper consumers use of on-line services. The Klobucher-Cotton bill would expand the authority of the Justice Department and the Federal Trade Commission to intervene and stop acquisitions by large tech companies which would increase their monopoly power. The burden of proof would be shifted to the acquiring companies to establish that their actions would not be anticompetitive. Klobucher characterized this as a modernizing of our anti-trust laws to deal with our new digital economy. Jeffrie’s House Bill would target tech companies with market capitalizations of over 0 billion dollars. Last June a House Anti-Trust panel approved a group of five bills to place more control on tech giant companies. Provisions of these included things like keeping tech user data portable, preventing platform owners from selling their own products therein, and not allowing preferences to be given to selected sellers. The panel narrowly approved these on a bipartisan vote after spirited debate. CONTINUED ON PAGE 118