Shoppers back the independents in grocery price battle
Thursday, March 13, 2008/
Consumers have rushed to back independent retailers in the war of words over grocery prices currently being played out before the national competition watchdog.
Almost half of the 109 submissions received by the Australian Competition and Consumer Commission inquiry into grocery prices have come from shoppers outraged at what they see as unjustified grocery price rises.
While the thrust of the consumer submissions varies, this comment from Gosford shopper Andrew Kfoury is typical: “I have been purchasing a three litre bottle of Dairy Farmers Skim Milk for $5.99 for three months from Coles supermarket, Gosford. The price increased overnight to $6.36, an increase of almost 6%. This is just one example of the supermarket chain’s unjustifiable increasing the cost of groceries on to the consumer.”
Southern Sydney Retailers Association head Craig Kelly says the support independent retailers have received from consumers is welcome, but not unexpected.
“Almost every family in the country has experienced these huge price hikes in the supermarket. Families are under pressure with rising pressure prices and they want to know why grocery prices are rising too,” Kelly says.
However, the view the ACCC forms on grocery prices may ultimately have more to do with the evidence put by business groups on the competitiveness of the retail grocery market.
And it will face a tough task in doing so, with almost diametrically opposing views being taken by independent retail groups and groups representing the large supermarket chains.
Kelly’s Southern Sydney Retailers Association, for example, argues that over the last 17 years Australia has led the world in price rises because “competition has collapsed at the retail level”.
This sentiment is echoed by groups such as the Master Grocers Australia, which argues in its submission that “the market dominance of the major chain stores is increasing, not because independent retailers cannot compete economically, but because of the anti-competitive elements of the market structure”.
In the other corner are groups such as the Australian National Retailers Association, which represents companies such as Coles and Woolworths. According to ANRA, the retail grocery sector is in a healthy state.
“The intensity of competition in the sector is obvious in the relatively low margins in the sector,” ANRA says. “The result has been more stable and lower prices for consumers.”
In the middle sits the ACCC, which will provide its report to Minister for Competition Policy and Consumer Affairs Chris Bowen by the end of July.
It will be under pressure to deliver a result that reflects widespread consumer concern about rising grocery prices, but independent retail groups such as Kelly’s are not confident that they will be pleased with the ACCC’s findings.
“The concern we have is that the ACCC in the past have been apologists for Woolies and Coles. They are on record as a saying all the evidence points to a vigorous competitive market; we don’t think they’ve done their homework in the past, but we’ll see,” Kelly says.
Feel the churn: How to bounce back after losing staff and clients Sue Parker DARE Group founder
Own it: The 10 things you need to do to manage your personal brand Lisa Stephenson Who Am I Projects founder
How to call your team into action with a winning presentation Emma Bannister Presentation Studio founder
The link between diet and mental health — and how to eat your way to wellbeing Kate Save Be Fit Food co-founder
From interactive videos to AI: The five marketing trends that will dominate 2019 Warwick Boulter Collaboro co-founder
Australia is leading the legaltech revolution, but what does this mean for lawyers, firms and clients? Jodie Baker Xakia founder
Why a video news release needs to be part of your PR strategy Leisa Goddard Adoni Media managing director
Want to catch more customers? Here's how to create a super sales funnel Jovana Vujnic Bumper Leads founder