OFT says construction industry is among worst hit by unfair practice.
Small construction firms are suffering from unfair practices such as cartel price-fixing, according to new research by the Office of Fair Trading. The OFT surveyed small and medium enterprises (SMEs) across a range of industries, and found that construction firms were among those facing the most difficulty, with 21 per cent saying that they were unable to compete freely and fairly for new contracts.
The OFT is urging SMEs not to be afraid of reporting anti-competitive practices: only 22 per cent of those surveyed said they would report price-fixing between competitors, and only nine per cent said they would report being pushed out of the market by a larger competitor cutting its prices below cost. More than one in five firms felt it had been a victim of anti-competitive behaviour.
In April 2005, the OFT launched the 'Championing Competition' campaign to promote the benefits of competition to SMEs and to raise awareness of their rights and responsibilities under competition legislation.
Professor David Storey, Director of the Centre for SMEs at Warwick Business School, commented: "What is interesting is that even when they experience anti-competitive practices, the reaction of the small firm owner is to soldier on without turning to the authorities. But using their rights under competition laws they can level the playing field to give them a better chance to beat the competition."