A fair deal for supermarket customers

We’re as angry about the power of the major supermarkets as many of you. Join our campaign to get a fairer deal.
 
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  • Updated:17 Nov 2009
 

01 .A Fair Deal for Supermarket Customers

Woman browsing supermarket shelves

We’re as angry about the power of the major supermarkets as many of you. We need your help to get a better deal for Australian consumers. Here's what you can do.

Australia has one of the most concentrated supermarket sectors in the world. The two supermarket giants - Woolworths and Coles - have around 70% of the market for packaged good and around 50% for fresh food. They face limited competition from smaller chains like Aldi, and independents operated by Foodwords and IGA.

Australian consumers have higher grocery prices than comparable countries, including New Zealand. And grocery prices are rising faster in Australia than anywhere else.


While consumers are paying more for their weekly shop the profits of the big supermarkets have remained high. Woolworths is one of the most profitable supermarket chains in the world; and Metcash – which has a monopoly on distribution to the independents – is even more profitable.

 

Changes to competition and planning laws will help to create greater competition for the big supermarket chains, but it’s time for grocery shoppers to take a stand and make choices that will promote a fair and dynamic grocery market.

 

What you can do

  1. Sign up  to join thousands of other Australians who want a better deal for supermarket shoppers. 
  2. Take action : send an email to your supermarket asking it to publish local grocery prices online.
  3. Use it or lose it! Try your local independent stores - greengrocer, baker, butcher or deli - and share your experiences here.
  4. Stay tuned: watch out for a CHOICE report on our investigation into supermarket prices - on CHOICE Online and in CHOICE Magazine from 1 December 2009.

 

 
 

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02.Our recommendations for a more competitive supermarket sector

 

What we want: A fair deal for supermarket shoppers

 

Our vision: A more dynamic and competitive grocery market; one that gives consumers genuine choice about where they shop and what they buy; provides quality products at fair prices; and levels the playing field so that a diverse range of retailers can meet consumers’ needs.

 

Australian’ consumers deserve a better deal at the supermarket checkout. Australia has one of the most concentrated supermarket sectors in the world. The two supermarket giants –Woolworths and Coles – have considerable market share and face limited competition from smaller chains like Aldi, FoodWorks and IGA. Yet Australian consumers have seen grocery prices rise higher than many other countries. While consumers are paying more for their weekly shop the profits of the big supermarkets have remained high, making Woolworths one of the most profitable supermarket chains in the world.

 

Consumers would benefit from increased competition in the supermarket sector. Governments, supermarkets and consumers all have a role to play in creating a more dynamic and competitive supermarket sector.

What government must do:

Help consumers drive competition through online access to price and product information.

  1. The Commonwealth Government should take legislative action that will require supermarkets to provide consumers with transparent and timely price information, delivered via an independently-supervised website. 

Remove barriers to competition

  1. The Commonwealth Government should enact creeping acquisitions laws as supported by the ACCC, that would prevent further concentration of supermarket ownership.
  2. The Commonwealth Government should enact changes to competition law which will give the ACCC the power to review the competitiveness of markets.
  3. Additionally, the ACCC should be empowered to require divestiture of assets where a corporation holds a dominant market position which reduces competition.  
  4. The ACCC should prosecute supermarket chains that are know to have breached the Trade Practices Act by engaging restrictive covenants in shopping centre leases.
  5. The Commonwealth Government should work with the State Governments to examine ways in whcih planning processes can be changed to ensure that there are no unreasonable barriers to mid-size competitors gaining ready access to suitable sites. Such changes shoudl not compromise other social objectives, such as community amenity and sustainability.

What supermarkets must do:

  1. Develop company-based customer charters setting out their commitment to achieving a minimum level of customer service.
  2. Demonstrate their commitment to achieving a minimum level of customer service by signing on to CHOICE’s proposed Supermarket Customer Charter of Rights.
  3. Establish an industry-wide Ombudsman to consider consumer complaints about breaches of the Supermarket Customer Charter of Rights.

What consumers must do:  

  1. Explore alternatives to major supermarket chains e.g. trying independent supermarkets and specialty stores like greengrocers and butchers. 
  2. Support the entry of new supermarket competitors in their local area, to put pressure on major supermarket chains.
  3. Demand that supermarkets publish the prices of a wide range of grocery items in individual stores, on an independently supervised website. 
  4. Tell supermarkets when they’re unhappy with prices or practices such as the removal of a favourite product, ask them to stock a particular product, or ask questions about the products they buy.
  5. Demand their supermarket signs up to a set of customer standards outlined in the Supermarket Customer Charter, and support the establishment of a Supermarket Customer Ombudsman.
  6. Report to CHOICE and the ACCC suspected cases of supermarkets abusing their market power.

 

 

 

 

03.Grocery Choice - the website they didn't want you to see

 

CHOICE agreed that Grocery Choice should deliver the following:

  1. Prices for thousands of supermarket items.
  2. The ability for users to set up personalised baskets so they could compare.
  3. Prices available from each store at the local level.

Video:

Please take our survey below.

Your say - Choice voice

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