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Inquiry call on Coles, Woolies dominance

Date

John Thistleton

IGA wants an inquiry into the dominance of Coles and Woolwooths.

IGA wants an inquiry into the dominance of Coles and Woolwooths. Photo: Supplied

IGA supermarket operators want the ACT Auditor-General to investigate why Coles and Woolworths will soon have nearly 40 per cent of the territory's entire supermarket space in additional floor space since the implementation of a supermarket competition policy.

Woolworths is soon to open the territory's largest supermarket at the airport at 4500 square metres, while Coles plans a new super store at Gungahlin.

Small operators believe the major chains' new sites and more on the drawing board in the city, at the Jamison Centre, Erindale, Kambah and Weston Creek, fly in the face of the competition policy.

Small supermarkets and the Shopping Centre Council of Australia, which represents shopping centres like Westfield which accommodate supermarket chains, say the territory is heading for an oversupply of supermarket floor space that could crush little operators. In a submission to the the ACT Assembly's select committee's inquiry into the supermarket policy, the shopping centre council says the competition policy is unwarranted, and by 2014 the territory could have the most competitive supermarket environment in Australia.

Kaleen IGA Supermarket owner Chris Haridemos said since the inception of the competition policy, major supermarkets had worked within the government's master planning process and by acquisitions to get another 37 per cent of the overall market share.

But there was no regard to the economic impact on existing supermarket operators, local independent businesses or the retail hierarchy.

Economic Development Directorate director-general David Dawes said no development applications had been received by either of the chains, and land had not been released in locations identified in the IGA's submission.

Mr Dawes said impacts from a new supermarket at the airport were considered.

The supermarket at the airport is on Commonwealth land.

''It doesn't necessarily conclude, however, that the most effective response is to limit the competition available to residents at their nearby group centres. The supermarket competition policy, which is aimed at improving choice for consumers in the full-line market, rather than smaller supermarkets and convenience stores, does not seek to preclude the expansion of the major chains in all circumstances,'' Mr Dawes said.

''In some locations, head-to-head competition between the two major chains is the only viable form of competition.''

He said that there was no risk of an over-supply of supermarket floor space.

''In fact, estimates of floor space expenditure per capita suggest that more floor space could be supported in the ACT relative to general industry standards.''

Supabarn development manager James Koundouris said he would be raising the allocation of new sites to major chains in masterplans at the elect committee's inquiry into the supermarket policy.

1 comment so far

  • The IGA and Supabarn bosses seems to think its retail space thats the problem,to me it comes down to price,why would I shop at my local IGA when the prices are up to $2 more expensive on each product.If IGA were really keen on being competitive,they would match prices.

    Commenter
    Martin says
    Location
    Canberra
    Date and time
    March 27, 2012, 10:07AM

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