From price gouging to promotion tactics, here are the key takeaways from the ACCC’s supermarket report

ABC NEWS (Australia)

The competition watchdog has found no definitive evidence of price gouging by Coles and Woolworths. A year-long probe has found Australia’s supermarket rank among the most profitable in the world but stopped short of declaring prices excessive. Suppliers are disappointed, saying they would like to see a fairer deal.

Transcript

00:00As food prices spiralled, supermarkets got the blame, prompting the ACCC's inquiry.

00:08To make sure that Australians are not paying $1 more than they should.

00:13We want them to be profitable, but we can't have price gouging.

00:17After a year and millions spent, the Consumer Watchdog says...

00:22Price gouging is a very difficult concept.

00:24Actually drawing a line on whether or not prices are excessive or not is very difficult.

00:29The Watchdog also didn't say the big two have a duopoly, saying there is limited competition

00:35from Aldi.

00:36Look, it's David and Goliath.

00:37If they don't pay us enough, then we're struggling to pay our farmers enough at the same time.

00:42As suppliers struggle, supermarket margins are rising, especially on packaged and branded

00:48products.

00:49Apples, bananas and eggs get resold for more than 30% of their cost.

00:54Potatoes have a margin that's higher than 40%.

00:58While dog food and dishwashing tablets also offer big margins.

01:03Margins are different to profits.

01:05Australia, the ACCC notes, is one of the most profitable places in the world to operate

01:11a supermarket.

01:12I basically only buy things when they're on sale.

01:15If it's not on special, it's pretty expensive.

01:18I shop around to get specials, never buy things at full price.

01:23Coals are confusing customers, the Watchdog says.

01:26It's separately taking Coles and Woolworths to court over allegations that they're putting

01:30out fake discounts.

01:32Clearer labelling and a review into loyalty schemes are some of its 20 recommendations.

01:39We accept all of those recommendations in principle and in most of those areas, we are

01:44already taking substantial steps.

01:46But the government's only extra announcement on releasing this report is $3 million to

01:51help suppliers.

01:53$3 million won't go very far.

01:55The opposition is agitating for farmers.

01:58We believe in successful businesses, but it's got to be in competitive markets.

02:02Woolworths and Coles say that their sector is competitive.

02:06Clearly investors aren't worried about looming regulation.

02:09Both of these companies' stocks surged today as this report was released.

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