Outgoing Metcash chief slams ACCC, but Wesfarmers boss defends the supermarkets

There’s more action in the grocery space, with outgoing Metcash chief executive Andrew Reitzer criticising the competition watchdog for failing to stop the power of supermarket giants Coles and Woolworths.

But Wesfarmers chief Richard Goyder has defended Coles, saying it is open to hearing from suppliers who feel they’re being hard-done by.

Both comments come in the shadow of the Australian Competition and Consumer Commission’s probe into the supermarket industry, with chairman Rod Sims saying it will investigate for breaches of power.

Speaking to The Australian, Reitzer said the ACCC has “done nothing” to correct the “imbalance of market power”.

“We’ve gone through a period where the spotlight has been on our industry with various inquiries and investigations, and during the periods when the spotlight is on, the behaviour within the industry has been a lot more kosher, but then the spotlight goes off and they get up to all their usual tricks and uncompetitive behaviour.”

The comments came as Metcash announced former Warehouse chief Ian Morrice as its newest chief executive.

However, Sims has already signalled the watchdog will probe the supermarket industry for any abuses of power. The food and grocery industry regularly complains about the duopoly, saying multiple collapses are due to an expanse of power.

The ACCC declined to comment.

The Australian Food and Grocery Council was contacted for comment, but wasn’t available prior to publication. Its chief executive Gary Dawson recently criticised the supermarkets on SmartCompany for expanding private labels and pushing out producers.

But the supermarkets have hit back and Wesfarmers chief Richard Goyder has expanded on comments made earlier this week in saying suppliers need to up their game, telling the UBS Global Leaders Insights Series that suppliers should feel free to contact the company at any time.

“I’ve always said to any of our suppliers, if there’s a particular issue and you can’t deal with Coles, by all means, come and talk to me about it, because we’ll behave in a responsible way.”

However, he also repeated the sentiment he shared earlier this week, arguing part of the problem is suppliers not investing in new technology.

“So in that environment it’s much easier to blame Coles for what’s going on than actually look at all the good stuff we’re doing,” he said.

Both Metcash and Wesfarmers were contacted by SmartCompany, but no reply was available prior to publication.

The Australian Dairy Farmers has been one of the loudest voices in the debate between the supermarkets and suppliers. Earlier this week the association told SmartCompany calls from the supermarkets for the industry to simply increase exports fail to understand the seriousness of its current price pressures.

 

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