Grocery Choice still a farce: Expert

The second monthly report from the Australia Competition and Consumer Commissions’ Grocery Choice website has just been released, but at least one business law expert has slammed the price monitoring system as farce.

The second monthly report from the Australia Competition and Consumer Commissions’ Grocery Choice website has just been released, but at least one business law expert has slammed the price monitoring system as farce.

Frank Zumbo, associate professor at the University of New South Wales’ Australian School of Business, says the Grocery Choice website, which compares the prices of baskets of products across the major and independent supermarket chains, is flawed as it only reports monthly and does not take into account constantly changing specials and discounts.

“Grocery Watch is a waste of taxpayers’ money as it only provides a very limited monthly ‘snapshot’ that will be out of date as soon as it is put on the website,” Zumbo argues.

Consumers are being misled as the report does not name individual supermarkets, but names the so-called “cheapest” supermarket chain on an overall, very-generalised basis in each region. As a result, consumers may not be shopping in the cheapest individual supermarket in their region.

But the latest survey from Grocery Choice appears to indicate there has been some downward pressure on grocery prices.

The ACCC says the latest report shows Coles supermarkets are the cheapest in 40 of the 61 regions surveyed in the total grocery basket. In the first survey, Coles was cheapest in 52 of 61 regions.

The ACCC also says that the price difference between Coles, Woolworths and independent supermarkets has narrowed on a national basis.

Meanwhile, the Australian Retailers Association has lashed the Rudd Government’s plan to introduce unit pricing. Chief executive Richard Evans says the scheme will cost retailers $30 million and not save consumers any money.

“Anyone who thinks unit pricing will reduce grocery prices needs to spend more time analysing the situation,” Evans says.

“The Standing Committee on Economics report clearly indicates restrictions and additional compliance requirements on the retail market (including in-store redesign and technology upgrades) will increase costs for retailers by up to $30 million, which would ultimately be passed on to consumers.”

Related stories:

• How the Grocery Choice website could dramatically change the retail sector: Kohler
• Grocery report recommends unit pricing and new website to keep prices in check