ACCC CHAIRMAN Graeme Samuel has missed the point in the matter of the recent price war between Coles and Woolworths, according to the Victorian Automobile Chamber of Commerce (VACC).
Coles and Woolworths/Safeway this week announced huge petrol discounts of up to 40 cents a litre for customers spending between $100 and $300 in stores - a move that has been criticised by a number of peak consumer and automotive business groups across Australia.
At issue is that if these giant grocery chains can discount to such a level, they are price-gouging somewhere - either on the groceries, or on petrol.
VACC Executive Director, David Purchase, said that the ACCC Chairman’s suggestion that independent petrol stations move to match the discounts on offer by the giant retailers is an “impossible” position that would put them out of business.
“Big supermarkets running big fuel outlets can discount heavily because they have the wherewithal to do so. But small independent service station and convenience store owners simply cannot,” Mr Purchase said.
“They do not stock the thousands of grocery items to subsidise a 40 cpL discount. Most small independent service station owners are only surviving by the skin of their teeth and this discount price war has the potential to tip many over the edge.
“Contrary to Mr Samuel’s comments, it is impossible for small independent fuel retailers to ‘match’ this level of discounting and remain in business,” he said.
Mr Purchase said that rather than focusing on supermarkets and their competitors in the grocery sector, consumers would be better served if the ACCC investigated the motives behind the massive discounts being offered by Coles and Woolworths/Safeway.
“Could it be because there will be a pay-off in the future once competitors and small independent service station owners have been eliminated?”
“While Mr Samuel says ‘the ACCC’s responsibility is towards 21 million Australians’, those very people the ACCC is trying to protect may ultimately lose out when there is little, if any, real competition,” Mr Purchase said.
Motorists might reasonably be disappointed that the ACCC has been all-but ineffectual in untangling petrol retailing practices in this country, and continues to preside over what it has itself described as a “comfortable duopoly”.
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I get blown away when I hear people saying it’s easy to spend $100-300 when doing you shopping at the supermarkets. I rarely get $100 bill. Why? because I go to the butcher to buy quality meat, at the deli to get my cold meats and cheese, the market to get my fruit and veg. And guess what, the meat, veg etc are cheaper by a 1/3 to a 1/2 the price at the supermarkets. So I save much more that the dollars they are offering now. This whole thing with discount petrol is a joke and if the ACCC doesn’t stop it, the number of small petrol seller are going to be squeezed out of the marmet place . So much for free enterprise. I also note that the petrol sold by Shell and Caltex appears to be substandard. How is this. Simple, Just fill your car up with a differnet brand of petrol each major fill and see what your consumption is. I bet you will be surpriced to see that the difference between Shell-Caltex and Mobil-BP is about 1/2 litre per 100km. That is you use less with Mobil-BP. Again, the discount of 4c/litre is a joke.
You’d think from the hysteria in the press and in the ‘burbs that this was a government-legislated exercise that consumers were forced to undertake! For goodness sakes, it’s a promotion. Ever noticed the weekly catalogues of Woolies and Coles? Are they regarded as “price gouging”? The big discount offer is simply another way of distributing markdown dollars, nothing more, nothing less. The fact that they’ll wear some loss-leading fuel dollars over a few days doesn’t mean as some would have us believe that Coles are otherwise making 40 cents a litre on fuel.
I also think it appropriate to credit consumers with a little more intelligence. Believe it or not, there are plenty of households out there spending upwards of $200 at Coles or Woolies each week, not because they’re forced to, but because they choose to. And if they chose to buy forward on non-perishables during the offer period, then I’m to be convinced that they suffered some awful evil. It’s no more than Costco will be doing when they launch their buy-very-big concept later this year. I’d also credit households with the intelligence to realise that 40 cents per litre against 50 litres is $20, no more, no less.
Tony m, dodgy fuel from Shell and Caltex? They might be nasty multinationals but the concept of them risking reputations by flogging sub-standard fuel stretches credibility. They don’t seem to fit neatly into the current-affair style fly-by-nighters if you ask me. 4 cents per litre “a joke”? Well, it appears to be a long-running and sustainable one from my viewing position.