Thu Sep 26 13:01:34 UTC 2024: ## Supermarket Giants Under Fire as ACCC Finds Consumers Distrust Sale Claims and Barriers to Entry
**Canberra, Australia -** The Australian Competition and Consumer Commission (ACCC) has released an interim report revealing a lack of consumer trust in supermarket sale prices and potential barriers to entry for competitors in the grocery sector, raising concerns about the dominance of Coles and Woolworths.
The report, a midpoint in the ACCC’s year-long investigation, highlighted concerns expressed by 21,000 customers, including high prices, confusing pricing policies, and skepticism towards loyalty programs. It also revealed that suppliers are facing unfair contracts, risk transfer, and information imbalances that weaken their bargaining power.
The ACCC found that Coles and Woolworths control a staggering 67% of supermarket sales nationally, and their significant holdings of undeveloped supermarket sites could be hindering competition. While Aldi has managed to gain a 9% share of the market, it took 20 years, highlighting the challenges faced by newcomers.
The investigation has already led to legal action against Coles and Woolworths over misleading discount claims, and the government is considering a mandatory Food and Grocery Code to ensure fair practices.
**Key findings:**
* **Consumer distrust:** Customers don’t trust sale price claims and are concerned about being penalized for not joining loyalty programs.
* **High prices:** Consumers are concerned about high prices and profit margins.
* **Barriers to entry:** Coles and Woolworths hold numerous undeveloped supermarket sites, potentially hindering competitors.
* **Supplier concerns:** Suppliers report unfair contracts, risk transfer, and information imbalances that weaken their bargaining power.
The ACCC will continue its investigation, focusing on the potential impact of market power held by the supermarket giants on consumers and suppliers. Public hearings with senior executives from Coles and Woolworths are scheduled for November, and the final report is expected in February 2025.
The government has expressed its commitment to ensuring fair competition in the sector, while the opposition has called for new divestiture powers to target the supermarket giants.
The ACCC’s investigation has brought the issue of supermarket dominance to the forefront, with consumers, suppliers, and the government demanding fairer practices and increased competition in the grocery sector.
First Piper 