Thursday, February 22, 2024

Coles and Woolworths respond to Senate inquiry

Coles and Woolworths have both provided statements regarding the Senate inquiry into the price gouging of major supermarkets amid Australia’s cost-of-living crisis.

Spearheaded by the Greens, the inquiry will scrutinise the impact of market concentration on food prices and the pattern of pricing strategies employed by the supermarket duopoly.

It will also assess the rise in essential item prices, the validity of discounts offered, and the inflation of profits during economic hardship.

Coles confirmed yesterday (6 December) that CEO Leah Weckert will appear at the Senate inquiry next year.

“We know cost-of-living pressures are front-of-mind for many Australians and we’re working hard to keep prices affordable for Australian households,” she says.

“We have worked collaboratively with previous inquiries and are ready to work with the Committee and engage in an informed discussion on the factors that influence supermarket pricing.

“We continue to invest in providing great value to our customers, supporting our network of more than 8000 suppliers and providing employment to more than 120,000 Australians right across the country.”

Also commenting on the inquiry, Woolworths Group CEO Brad Banducci says the retailer is “very aware” of the pressures facing many Australian families.

“We welcome the opportunity to explain to the Senate how we’re working to balance the needs of our customers, our team and our suppliers in the context of economy-wide inflationary pressure,” he says.

“As we’ve done at several inquiries this year, we will openly and constructively assist the parliament with its work on this important topic.

“We’re proud to directly employ 180,000 team members in Australia and support the livelihoods of 18,000 suppliers in the communities we serve.”

Coles

Coles says it remains focused on delivering value to Australian households and families through its Great Value Hands Down campaign, “thousands” of weekly specials, Flybuys program and other initiatives.

In its recent statement, Coles notes that its total supermarkets price inflation declined to 3.1% for the July-September quarter. Fresh food (including fresh produce, meat, deli and seafood) experienced deflation of 2.3% during the July-September quarter.

“Having a profitable business means Coles can continue to serve Australians, invest in our stores, employ our 120,000 team members, support our local communities, pay taxes in Australia, pay dividends to our hundreds of thousands of mum and dad shareholders and ensure long-term sustainable relationships with our suppliers,” adds the retailer.

“It also puts us in a position to invest in promotions, thousands of weekly specials, our Flybuys program and other initiatives to deliver value for our customers.”

Woolworths

Woolworths says it offers 6000 specials every week and has dropped the price of all its standard lamb cuts by 20% as well as the price of 400 products for summer.

In its recent statement, Woolworths notes that it lowered the price of its half leg ham to $8/kg in October. The retailer says this is the lowest price on ham for the Christmas table since 2014.

Further to this, Woolworths says its fruit and vegetable and meat categories are in deflation, with prices falling.

Woolworths Group’s margins were lower in the 2023 financial year than they were 10 years ago (FY 2014), said to be in contrast with ABS estimates of margin growth across the broader economy.

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