One of the UK's biggest convenience store chains is reportedly under investigation for hiking prices during the coronavirus pandemic.
Nisa, which has more than 2,500 independently owned local stores in the country, has been contacted by competition watchdog the Competitions and Markets Authority (CMA) over pricing complaints.
From March 10 to April 19, the CMA received almost 21,000 complaints about Covid-19 related issues.
It said companies who exploit vulnerable shoppers during the pandemic could face legal action and even prosecution.
In total, the CMA's taskforce has reportedly written to 187 traders after receiving 2,500 complaints about price rises.
One of these is said to be Nisa.
"Last week we were approached by the CMA following a number of consumer complaints about unusually high prices in Nisa partner stores," a leaked document to retailers from Nisa, seen by publisher betterRetailing, explains.
"We are aware that in some instances this has been down to products coming off promotion, newly introduced lines or pricing being higher on some substituted lines," it read.
"But, we would advise where this is the case, you highlight the reasons for the higher prices, either on the shelf edge or on posters around the store, to avoid consumer confusion and frustration."
According to the leaked document, nearly 75% of complaints related to food and drink, 20% related to hygiene products and around 5% related to medicines.
Nisa retailer Harj Dhasee said that despite increases, he is continuing to sell at wholesale prices to protect his reputation.
"Milk cost price is £1, but we are selling it at £1," he told the website.
"We haven’t moved our prices because we don’t want to be seen to be profiteering, but at some point, prices will have to move."
Dhasee said he has witnessed the removal of some price-marked packs, adding that retail pack prices have increased since March.
In contrast, wholesale pack prices have fallen.
"A 1.5kg bag of flour has gone up, but the 12kg has dropped because restaurants aren’t open," he said.
Dhasee said despite his sales doubling, his profit margins have been “dramatically squeezed”, and he is “not confident the additional costs of necessary new staff will be covered as a result”.
A spokesperson for Nisa said: “The majority of Nisa’s retail partners have done an incredible job serving their communities throughout this crisis. Nisa was just one of hundreds of retailers the CMA contacted.
"We quickly responded to make clear how seriously we take this matter, explain that Nisa is not responsible for price setting in its partner shops, highlighting that Nisa partners are free to buy stock from other wholesalers, and also emphasising that throughout the crisis Nisa has regularly raised the importance of responsible pricing with its retailer partners.
"Pleasingly, the CMA has subsequently made clear that they do not have any concerns around the conduct of our business.”
The CMA said it will take enforcement action against retailers who break the rules.
A statement on its taskforce guidelines said: "It [The CMA] can seek further information from businesses; it can issue them with advisory or warning letters; it can work with enforcement partners, consumer bodies and trade associations; where appropriate, it can take enforcement action under its competition and consumer protection law powers; and it can advise government, including on any emergency legislative changes that might be required."
