VACC, the peak Automotive Industry body in Victoria, is appealing to motorists to sit up and take notice of the recent publicity surrounding the increase in supermarket grocery prices.
According to Associate Professor Frank Zumbo, a competition and consumer law expert at the University of New South Wales, “food prices in Australia have increased 41.3 percent since the start of 2000 – resulting in Australian families being forced to pay some of the fastest rising food prices in the developed world”.
“Coles and Woolworths control around 80 percent of the grocery market and the lack of competition in this sector has allowed them to drive prices up. This trend is also already happening in the retail fuel industry. And it could get worse for consumers and Independent Service Station owners, once Woolworths enters the hardware sector as Woolworths would seek to link hardware purchases with their petrol discount dockets,” Professor Zumbo said.
“VACC is alarmed that a lack of Government intervention, together with weak competition laws, has paved the way for big supermarkets to dominate. If Mobil leaves the retail fuel market, then the supply of fuel will be even further concentrated and competition lessened” VACC Executive Director, David Purchase, said.
“The Independent Service Station owners do their best to compete with Coles and Woolworths and their fuel retailer partners, Caltex and Shell. But it is an uphill battle and a fight they take on with one hand tied behind their back. Independent Service Station owners do not have access to the same wholesale prices as the supermarkets and they do not benefit from the same price discounts along the supply chain.
“Many Independent Service Stations trade at a loss, but they continue to provide a service. However, if they were to cease trading, we suspect Coles and Woolworths would seize their chance and tie up the market, making it impossible for any small businesses to return or start up.
“VACC believes it is in the public interest for Independent Service Station operators to be afforded an environment in which they can compete, otherwise consumers will end up paying higher fuel prices in the future.
“In the meantime, VACC continues to oppose predatory pricing, creeping acquisitions, restrictive leases and geographic price discrimination through its Service Station and Convenience Store Division,” Mr Purchase said.