The Australian Competition and Consumer Commission is progressing to the next phase of its supermarkets inquiry after receiving significant feedback from consumers and grocery suppliers regarding the substantial market power of major supermarket retailers.
The interim report detailed findings from the first half of the year-long inquiry, incorporating insights from stakeholder submissions, a consumer survey, and supplier feedback gathered in rural and regional Australia.
Woolworths (ASX:WOW) and Coles (ASX:COL) dominate the market, controlling 67% of supermarket sales, which may limit competitive pricing, according to ACCC Deputy Chair Mick Keogh.
Consumers are increasingly concerned about rising grocery prices, with the typical grocery basket up over 20% in five years. Many low-income households spend more than 20% of their net income on groceries.
Keogh noted that growing consumer scepticism about pricing practices has led nearly 50% of respondents to compare prices across stores frequently, up from 17% in the 2008 grocery inquiry.
Suppliers also report challenges, often receiving prices below production costs and facing unfavourable terms imposed by retailers.
The ACCC is investigating these claims, focusing on practices that may harm both consumers and suppliers.
The inquiry will examine 14 specific products, such as beef, chicken, and dairy, and hold public hearings in November.
The final report is expected in February 2025, with feedback on the interim report invited until Oct. 18 before finalising its findings and recommendations.