Blog 18th Anniversary: The Duopoly of Australian Supermarkets

 The duopoly of supermarkets continues across Australia, as corporate muscles are flexed against suppliers, staff and customers in a relentless obsession of growth in profits, dominance and control. 

I support more of stand alone independent grocers and direct producers, they have more variety on their shelves.  As prices in Coles and Woolies have gone up, they cannot compete price wise with some independent grocers, especially ethnic ones like Italian, Spanish, Chinese, Vietnamese, Indian, etc. 

My strategy now is to be mindful of selected items of grocery to buy - and suppport small business in my locality as far as I can. A more focused approach helps to avoid wasting expenses on addictive food, zoom for more quality in edibles and exercise our minds and hearts in better choices with discretion. 

Fresh eggs are not bad at Aldi, they do not shelf them in fridges like Coles and Woolies. Fresh milk at Aldis is a good buy, but at the same time there can be a lot of distracting products at Aldi outlets. 

More distracting is the preponderance of products laden with sugar, salt, preservatives and fat at the main supermarkets.  Do walk the aisles and make up your own mind. 

If one resides in an Australian regional area, I understand there can be a lack of choice -  and one depends more on the duopoly. 

This is echoed in the lack of competition especially in the Australian sectors of domestic air travel, pharmacies and banking. 

Fresh produce markets are fascinating to me, but generally since Covid, prices have spiked at such stalls, even if quality is maintained. 

I have also dabbled in ordering online offers of groceries and white goods - some provide free  and next day delivery at the very latest.

The physical store model is increasingly under threat - the way some businesses are treating customers is viewed in disdain by more people I know. 

Need we visit a supermarket venue to get essential food?  We step in such places and we observe some using them for social chats.  We also note the rise in self managed check outs with narrow spaces.  Cameras are attached to monitor the movement of human beings.

Pyschological games are played with posters put up by the supermarket to induce us to buy, but which underestimate our level of intelligence. 

Do reflect on the huge numbers of real estate such supermarkets sit on, they can easily get into the commercial property game once they stop selling food. 

There has truly been this relentless drive to know what you and each family have bought in the past to shape millions of purchasing profiles.   The underlying rationale is that once you buy something, you will buy it again.   This model excludes the very possible human trait of not purchasing the same thing ever again - and the right to have a significant change in taste. 

The use of membership cards implies the giving of peanut reward points to customers. 

The duopoly puts its bets on greater convenience, habitual pattern of spending and lack of competition for the majority of the population to

regularly visit its outlets.  They are also experts in marketing, human behaviour and commercial practices.   

#yongkevthoughts

Two Dominant Supermarts in Australia

 The ACCC complaint in 2024 echoes one of the reasons I hardly go to Coles and Woolworths for three years now....

these supermarkets now make net annual profits of at least around a billion aud.

In past 2 years, when I see their outlets, they have political like banners in big font shouting out 1/2 price, Down  Down Down and such stuff.

Is excessive corporate greed is so obvious from Coles and Woolworths?  Just check with our own gut feel.

The Australian government
mentality is as usual - wait for the matter to grow exponentially and then only point fingers.  Singapore has a different approach.

Coles and Woolworths have grown so market dominant they are too big to fail and are a duopoly, capturing 90 pc of the Australian retail market for groceries. Across Australia, we most probably and instinctively do not say "We are going grocery shopping" - we naturally say " We are going to Coles" ( or Wollies).

I prefer to buy from several other sources like independent local shops, online delivery options, local fresh markets and small businesses.

The most insulting thing from Coles and Woolworths is that they underestimate the intelligence of their customers.

Most of their products are also manufactured processed food with unhealthy dosages of fat, salt, sugar and preservatives.

Coles has also bought into offering Malaysians their products.  My view is to avoid them.

#yongkevthoughts

The Changing Supermarket

 

So I noticed the new packaging, smaller serves and higher prices charged.

Just dropped by a mainstream supermarket, which does hold a duopoly advantage in a business sector vital to everyone's lives in a nation of around 25 million.

Perhaps it is just me, but the increased processing of food is so obvious on their aisle shelves, as opposed to the more pleasing sight of natural produce.

Ready made meals with more preservatives.  Bites and packages that utilise latest food technology but coldly hiding behind manufactured artificiality.
Convenience emphasised with the furthest distance from the natural producer.

So much sugar, so much salt and other chemicals.  Edibles over standardised in look and formula.  So many items looking like clones and fulfiling measurements that cater to logistical and cost imperatives, rather than appealing to our human instinctive need for variety.

The inevitable self check out of the future is reinforced by the opening of only one cashier's aisle.  The seeping dominance of contactless payment methods is already foreshadowed by less direct contact between staff and customers.

Still, old fashioned pyschological methods to spur unplanned purchases, mixing of items with big discounts and high margins plus the attention placed on certain brands continue to be deployed.

More home brands at lower prices seem to oust separate brands not so connected with the supermarket chain.  Many of such home brands are made in the same factory.  There is a continuing hum about the significant hold by such supermarket chains  over producers, who increasingly have to decide on take it or leave it realities.  Too big to fail can summarise the powerful ability of such businesses.

Fruits and veg look not so appealing in the remaining fresh produce aisles, compared to what is on offer in local outdoor markets.  Milk is sold with labels stating it is sourced from various Aussie producers, rather than proudly naming the farm. 

Go figure.

#yongkevthoughts