Following the release today of the ACCC Supermarket Inquiry Report, the Australian Retailers Association (ARA) said the report acknowledges the rising cost of doing business has driven higher grocery prices and that the competition in Australia's grocery sector continues to evolve.
ARA Chief Industry Affairs Officer Fleur Brown said it's important to note that despite the many challenges faced by consumers and business in this cost-of-living crisis, there is no evidence of price gouging in the report.
"We welcome recommendations that improve transparency for suppliers and customers but caution against measures that increase red tape, stifle productivity or further drive-up costs.
"We believe the Australian grocery sector remains highly competitive, with a growing number of physical and online shopping alternatives. New entrants are gaining market share, and cross-shopping behaviour among consumers is at an all-time high, ensuring strong competition within the industry," she said.
"Our supermarkets operate one of the longest supply chains in the world, with low population density so these businesses must be profitable and operate efficiently to operate and serve millions of Australians across the nation.
"This represents the eighth taxpayer-funded report into supermarkets in the past few years. Our members have fully cooperated with the ACCC throughout the inquiry process and are carefully reviewing the report's findings and will continue to take constructive action to address cost of living pressures," Ms Brown said.
"Our members are committed to policies that drive down business costs, ensuring that savings can be passed on to consumers. Supermarkets have proactively implemented many measures to benefit consumers and suppliers including enhancing pricing transparency, increasing promotional offers, expanding affordable product ranges, and streamlining supplier engagement.
"It is also pleasing to see that despite the many cost of doing business and supply chain challenges faced by the industry, food inflation has remained relatively stable, and household spending on food has declined as a proportion of total expenses.
"We also welcome the report's recognition that grocery inflation in Australia was lower than many OECD countries.
"Through the past five years, Coles net profit margin of 2.6% has remained stable and Woolworths has remained stable at less than three cents in the dollar.
"Importantly, our Australian supermarkets contribute significantly to the community in the form of Australian taxes and superannuation portfolios, and by purchasing from local Australian suppliers. Supermarkets are Australia's largest private employers and also support communities in times of crisis such as bushfires and flooding.
"It is important that regulatory changes do not inadvertently increase supplier costs or introduce inefficiencies that could place upward pressure on prices," Ms Brown said.
"Businesses across the country have faced increased costs during the past few years, from steep interest rates to supply chain delays. These operational costs cannot be overlooked when considering competition and pricing strategies.
"Retailers are responding by enhancing pricing transparency, increasing promotional offers, expanding affordable product ranges, and streamlining supplier engagement.
"The Australian grocery sector remains highly competitive, with a growing number of physical and online shopping alternatives. New entrants are gaining market share, and cross-shopping behaviour among consumers is at an all-time high, ensuring strong competition within the industry," she said.
