Woolworths wants ACCC supermarket inquiry to focus on the retail facts

Amid the politics of the Greens-led Senate inquiry into the supermarkets, Woolworths wants the ACCC to conduct its review on facts and data.

Woolworths has called on the ACCC’s inquiry into supermarkets to be “fact-based”. Picture: NCA NewsWire / Max Mason-Hubers

Woolworths has called on the competition regulator to conduct a “data-driven, fact-based” supermarket inquiry amid the political storm around the supermarket sector that has seen wild allegations of price gouging, misuse of market power and the Woolworths boss threatened with jail at the Greens-led Senate supermarket inquiry.

In its submission to the Australian Competition and Consumer Commission inquiry into the supermarkets, Woolworths has also highlighted the thin margins its operates under dispute claims of profiteering, arguing that even if Woolworths made no profits the average weekly savings on groceries per Woolworths shopper would be around $5 a week.

“Importantly, if our profits were substantially reduced, it would compromise our ability to sustainably invest in our operations, improve our service, quality, and efficiency, and improve our resilience to better manage ongoing supply chain risks and uncertainties, all of which benefit our customers and enable our significant contribution to the Australian economy and the communities we serve,” Woolworths said in its 103 page ACCC inquiry submission.

The ACCC inquiry into the supermarkets follows a Greens-led Senate inquiry, where chairman and chief inquisitor Greens Senator Nick McKim threatened to hold Woolworths CEO Brad Banducci in contempt with the potential of jail time for not answering a question to his satisfaction.

It also follows inquiries run by the Queensland and South Australian governments and a review of the Food and Grocery Code of Conduct.

But Woolworths, and its arch rival Coles, see the ACCC inquiry as the most important investigation into the $140bn supermarket sector, given both the power of the competition regulator and that it is not seen as a political show trial - which his how the Greens-led Senate inquiry was seen by many.

“We expect the ACCC to adopt a data-driven, fact-based, rigorous approach to the Inquiry,” the Woolworths submission to the ACCC said.

“We encourage engagement with stakeholders across the industry and consumers, including through well-designed, impartial consumer surveys.”

Its submission argues that since the ACCC’s last supermarket inquiry in 2008, there has been significant entry and expansion of global retailers such as Aldi, Amazon and Costco, which has ramped up competition.

“Three of the world’s biggest and most competitive retailers Aldi, Amazon Retail and Costco are present and growing in Australia, and offer compellingly different value propositions that further increase competitive tension.

“Aldi has tripled the number of its stores in Australia since 2008, opening more stores than either Woolworths or Coles and growing to around $12bn in annual revenue. Amazon Retail has expanded rapidly since entering in 2017, with projected gross merchandise value of $5.5bn in Australia for fiscal 2024 … and Costco expanded into the Australian grocery sector in 2009 and has since grown to $4.4bn in annual revenue.”