What started a few months ago, with the government’s populist swipe about supermarkets being complicit in price gouging, is evolving into finger pointing between the retail giants about who is potentially mistreating their small suppliers.

Everyone seems to be a victim in the supermarket saga. Woolworths doesn’t appreciate (along with Coles) getting singled out as the villains capitalising on the asymmetric bargaining power they have against small and medium-sized suppliers.

Craig Emerson has recommended considerable fines for supermarkets that break a proposed code of conduct.Credit: Peter Rae

Woolworths is engaging in a “look over there” strategy, suggesting that the spotlight be shared with other large retailers – such as Bunnings and Chemist Warehouse – that carry some grocery items on their shelves. For that matter, Woolworths wants the likes of Amazon and Costco to be captured in the net as well.

Further, confusing the debate, Woolworths found an unexpected ally from a bunch of horticulturists who jumped on board with claims they were effectively being bullied by Bunnings, which dominates the retail plant market.

Complaining about the cost of shrubs doesn’t really elicit the same response as the portrait of a pensioner scraping the bottom of their purse to buy milk. So it probably won’t meet the government’s populist criteria.

But it does feel like Woolworths is muddying the waters in this already-confusing debate, which was originally about the big supermarkets overcharging their customers.

There are two separate strands to the intense behavioural focus on the large supermarkets.

The first, which is being investigated by economist and former Labor minister Craig Emerson, deals with the voluntary Food and Grocery Code of Conduct. Since 2015, the code has set out the road map for how large supermarkets deal with their small suppliers.

QOSHE - Everyone seems to be a victim in the supermarket review - Elizabeth Knight
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Everyone seems to be a victim in the supermarket review

7 11
09.04.2024

What started a few months ago, with the government’s populist swipe about supermarkets being complicit in price gouging, is evolving into finger pointing between the retail giants about who is potentially mistreating their small suppliers.

Everyone seems to be a victim in the supermarket saga. Woolworths doesn’t appreciate (along with Coles) getting singled out as the villains capitalising on the asymmetric bargaining power they have against small and medium-sized........

© The Sydney Morning Herald


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