MP challenges market share of Coles and Woolworths
A bill proposing to “smash the supermarket giants’ stranglehold” on Australia's retail and production industries was introduced to Parliament this week by Katter's Australian Party Federal Leader Bob Katter
The 'Reducing Supermarket Dominance Bill 2013’ proposes legislation that would force Coles and Woolworths to reduce their market share to no more than 20 per cent each within six years, with a 'food retailing commissioner' ensuring compliance or hefty fines.
“We have to preserve what little competition we’ve got left, so that we can get a fair go,” Mr Katter said.
“It's vitally important to head off the untrammelled greed of the supermarket giants. Because once they have obliterated all other retail competition, along with our food production industries that can't compete with cheap overseas labour and an artificially inflated Aussie dollar, thanks to our successive free-market-obsessed governments, then they will be able to charge us whatever they want for inferior product.”
The supermarket laws are among three legislative pillars introduced by Mr Katter in a bid to restore power to Australia's food producers, small businesses and consumers against the might of a supermarket share concentration unseen anywhere else in the world.
Also currently before the Parliament are Mr Katter's 'Imported Food Warning Labels Bill 2013', to warn consumers that food imported from other countries could be produced in different conditions, and 'Dairy Industry (Drinking Milk) Bill 2011', to give dairy farmers the right to collectively bargain for a fair price.
At the Retail Nation event hosted by the Australian National Retailers Association in Sydney on Tuesday, Coles Managing Director Ian McLeod and Woolworths Managing Director Supermarkets and Petrol Tjeerd Jegen both dismissed the bill to reduce their market share to 20 per cent each.
Mr McLeod described the bill as extremist protectionist politics, while Mr Jegen said it was ill conceived.
Mr McLeod said politicians “should want what is right for the consumers.”
“Allow the competitors to compete, allow us to thrive, allow us to be efficient, allow us to be productive in terms of what we do, allow us to lower prices for consumers and that’s far better for the country.”
Both supermarket heads highlighted well-established supplier and farmer relationships.
“There are a number of suppliers growing very well on the back of their relationship with Coles," Mr McLeod said. "We continue to do a good job and work with them. By working with them for our customers then we’re going to be successful.”
24-hour Woolworths to open in Queensland
Brisbane shoppers will be able to get their groceries at any time of the day or night from next month.
The Woolworths supermarket at Brisbane Airport's Skygate retail precinct, off Airport Drive, will begin trading around the clock, seven days a week from Monday, July 1.
Woolworths Queensland State Manager Michael Batycki said a 24-hour full-sized supermarket meant residents, airport workers and passengers would have more choice and be able to shop at a time that suited them.
“The full range of supermarket products will be available, from hot chickens and fresh fruit and veg for a midnight feast to washing up liquid and laundry detergent to clean it all up," he said.
“We know there is demand for 24-hour shopping, especially in an area with lots of shift workers. Customers want to be reassured that they're not paying a premium simply for buying food out of hours. That's why, at Woolworths Skygate, the price you pay at midday will be the price you pay at midnight.”
Mr Batycki said the supermarket's new hours would also benefit staff.
“Our increased opening hours mean more employment opportunities, while current staff have the flexibility to alter or extend their shifts to suit their lifestyle,” he said.
Brisbane Airport is the third largest gateway to Australia, with flights arriving and departing around the clock. More than 20 million travellers pass through annually and 20,000 people are employed on site.
Cost of living on the rise, but retail steady
IBISWorld estimates that the average Australian's weekly expenditure on day-to-day living has risen by 10.4 per cent over the past decade, from $1,253.80 to $1,384.30.
IBISWorld General Manager Karen Dobie said Australians' average weekly spend on electricity had increased 58.3 per cent in 10 years, with average rent up 48.5 per cent, mortgage repayments up 44.3 per cent and gas and water bills up more than 35 per cent.
Retail spending is the only area in which IBISWorld research shows average weekly outlay has declined in the past 10 years. Spending on clothing and footwear, for example, has fallen to $49.20 per person from $50 in 2002-03 as a result of price cuts driven by aggressive discounting in an increasingly competitive market.
“Growth in the Australian dollar has boosted competition from overseas retailers, lowering the cost of imports for retailers and producers,” Ms Dobie said. "While the recent fall in the dollar is likely to persist, the prevalent downwards trends in the clothing and footwear retailing sectors are expected to continue."
As for electronic goods, Ms Dobie said prices had plummeted over the past five years due to a fall in production costs, especially for televisions, and because more products were being sourced from China, where economies of scale had driven per-unit costs down.
In contrast, spending on food and non-alcoholic beverages increased by 10 per cent, with the average weekly spend now $239.10 (up from $217).
Retail leasing a crucial issue for small business
Australian state governments have been urged to provide much-needed support to small businesses by helping to inform and educate them on their retail leases.
A series of Australian Retailers Association (ARA) Retail Leases workshops were held in Victoria recently, sponsored by the State Government’s Small Business Victoria.
The workshops were attended by some 70 retailers/lessees who gained insights into how lessors determined rentals and how lease negotiations could be strategically leveraged.
Workshop Facilitator and ARA-preferred service provider Phillip Chapman, Director of retail shop lease specialist Lease1, said the workshops were very well received by retailers.
“The feedback from retailers has been encouraging and to see retailers actively participating in these workshops is exactly the result we were after," he said. "I look forward to other state Small Business Commissioners getting behind this program of workshops and the efforts of the ARA."
At the Melbourne workshop, Victoria's Small Business Commissioner Geoff Brown fielded numerous questions from retailers, several of which raised the important topic of market rental determination at the exercise of a lease option.
The Commissioner likened the current situation under Victorian retail leasing legislation to "signing a contract to buy a new car without knowing how much the car is”.
Under the legislation, a retailer with an option in its lease must first exercise the option (committing to a future lease term) and then have the market rental negotiated or determined.
ARA CEO Russell Zimmerman advised the workshop that this issue had been raised with the association recently and he called upon retailers to advise their support of changes to be added to other reforms proposed as part of the forthcoming review of retail-lease legislation.
Retail sector trains the nation
Australians choose a first job in retail over any other sector, a new survey from the Australian National Retailers Association has found.
The independent online survey of 1,000 Australians aged 18 and over found that 22 per cent of respondents’ first job was in retail, with the next most popular sectors being finance and insurance, and manufacturing (both eight per cent).
ANRA CEO Margy Osmond said retail was a vital training ground for the nation’s workforce.
“The number increased in younger adults, with 28 per cent saying their first job was in retail," Mrs Osmond said. "This is consistent with the ANRA membership, with a third of their 500,000‐strong workforce under 25.”
Mrs Osmond said the flexibility of working in retail was an important factor for those studying.
“We found that just over a third of respondents said they were studying for a qualification or degree at the same time as working in their first job," she said. "This proportion rose to 57 per cent of 18‐24 year olds, showing that more students than ever are working to support themselves through study.”
The research also reveals that while many Australians get their first start in retail, it continues to be a major employer beyond that first job. Retail was the number one current employer across the board for respondents (seven per cent), followed by health and community services (six per cent), finance and insurance (five per cent) and manufacturing and personal services (both also five per cent).
“Retail continues to play a crucial role both in training the nation’s workforce and driving Australia’s economy,” Mrs Osmond said.
“ANRA members employ more than 41 per cent of the retail workforce, with 100,000 of these employees located in regional and rural Australia."
Food star rating to be implemented
The nation’s food and health ministers last week approved a new star health rating system for food nutrition.
The system will use a star rating scale from 0.5 to five stars to give consumers at-a-glance information about the food they are buying. The system will also include nutrient information icons for energy, saturated fat, sodium and sugars and can include one positive nutrient such as calcium or fibre.
Consumer watchdog choice and the National Heart Foundation of Australia (NHF) have both welcomed the health rating system, saying it has the potential to dramatically improve the nation’s food supply as well as helping consumers make healthier choices.
“While the new system will be voluntary, ministers have made it clear that they will consider a mandatory system if widespread uptake is not achieved within two years,” NHF National Cardiovascular Health Director Rob Grenfell said.
However, the Australian Food and Grocery Council (AFGC) warned the Federal Government that serious flaws remained and needed to be resolved if an effective front-of-pack-labelling (FoPL) system was to be implemented.
AFGC CEO Mr Gary Dawson said the food processing sector was willing to remain engaged in the development of the FoPL scheme, but a number of outstanding issues needed to be resolved.
“The food industry is expected to carry the $200 million cost of implementing this scheme while also dealing with an additional regulatory burden," he said. "If industry is going to make this investment in a new FoPL system, it must be based on sound and credible science, effective in communicating with consumers and practical and attractive for industry to implement."
The AFGC said an effective FoPL system would need to resolve issues such as how the star system was calculated to avoid anomalous ratings that would undermine the credibility of the scheme and potentially mislead consumers. It would also need to address whether there would be substantial funds to educate consumers on how to use the labelling for healthy diet selection and if the government was prepared to undertake a robust and credible cost-benefit analysis.
GS1 GoScan app wins ICT innovation award
Australia’s first whole-of-industry smartphone app with data direct from manufacturers was recognised at Victoria's 2013 iAwards with a Merit award.
The main judging criteria for the 2013 iAwards were based on uniqueness, marketability, functionalities/features, quality/application of technology and application of addressing the criteria. The winners were announced on June 5.
“On behalf of the GS1 GoScan team at GS1 Australia and in collaboration with the AFGC, I am deeply honoured to accept this award,” GS1 Australia CEO Maria Palazzolo said.
“This award is a testament to the vision, innovation and creativity of everyone involved in the development of the app.”
Launched for free download in March this year, GS1 GoScan is Australia’s first whole-of-industry endorsed smartphone application that enables consumers, with a simple scan of a barcode, to learn whether a food product suits their special dietary needs
Developed in association with major retailers, local and international food companies, the AFGC, Australian universities and national health organisations including Allergy & Anaphylaxis Australia, the app benefits consumers who have allergies, intolerances and special diets, providing more information about their food – direct from the manufacturer.
“This award is a great achievement for GS1 GoScan, further qualifying the app for the national iAward which will be announced on August 8,” Ms Palazzolo said
GS1 GoScan is currently available for free download on the App Store for iOS devices. GS1 Australia is currently working on an Android version with an expected release towards the end of 2013.
MFA award to recognise best food and grocery campaign
The Media Federation of Australia (MFA) is gearing up for another prestigious awards year, with the MFA Awards considered the Oscars of the marketing world in Australia.
Last year’s MFA Award winner in the Food and Grocery category was Vita-Weat, whose agency, MEC, created the ‘Top That’ campaign, soliciting food lovers to compete against each other by creating mouth-watering toppings for Vita-Weat.
The campaign sparked other foodies to get involved. Facebook was at the heart of the idea, which became a live photo gallery of fans attempting to outdo each other.
As a result of the campaign, Vita-Weat's value share of the crispbread market increased by a massive 30.5 per cent.
MFA recently announced a new category for ‘Marketing Team of the Year’, which will be awarded on October 24. The new award is about recognising excellence and the importance of teamwork and is designed to send a message that behind every successful campaign is an incredible marketing team.
MFA Chair Henry Tajer said this would be the only award in Australia for a marketing team by an industry association.
“We’re thrilled to announce this initiative as the MFA turns 15 years," Mr Tajer said. "The award is about celebrating the breakthrough ideas and results by working together. It’s the importance of media agencies and the client forming close and communicative relationships where ideas and great work flourish."
The new award was developed in consultation with the Australian Association of National Advertisers.
Shop A Docket rolls out free mobile phone coupon program
Smartphone users will now have access to more than 2,500 free discount coupons, in the largest rollout of mobile phone redemption in Australia
Shop A Docket’s mCoupon project, two years in the making, is the largest of its kind in Australia.
The mobile phone redemption program uses Google location technology and a simple search-and-select menu to identify offers in an area. Consumers present their phone at the point of sale to simply redeem the offer. There is no requirement to register or download an app to access the offers.
National Sales Manager for Shop A Docket Tim Wingrove said that until now, discount coupons had been restricted to shopping receipts and online.
“Now it no longer matters if you are the main grocery buyer, travelling interstate, or working in an area where you don’t shop – free coupons will be accessible around the clock and you don’t need to carry receipts with you," he said. "All you need is an internet-enabled phone.
“We expect this initiative will revolutionise the way shoppers decide where to spend their money."
The Avolution provides year-round local avocado supply
A new avocado marketing company is bringing together producers from around the country to ensure retailers have access to locally grown fruit all year round.
The Avolution CEO Antony Allen, speaking at the company’s official launch at the PMA Fresh Connections Conference in Sydney last week, said The Avolution simplified and centralised the marketing of avocados.
“We are focused on the expansion of the avocado category, as well as making sure that growers are maximising returns on their fruit,” Mr Allen said.
Founded in March 2012 by major Queensland-based avocado producers Lachlan Donovan and Daryl Boardman, together with West Australian avocado packer Jennie Franceschi of Advanced Packing and Marketing Services, The Avolution represents growers in Queensland, Victoria and WA and currently supplies 20 per cent of Australia’s avocados.
Between the three main avocado pack houses, including a network of smaller growers that supply fruit to APMS and Sunnyspot Pack House in Ravensbourne, Queensland, The Avolution has a 12-month supply covered.
“Previously, there was a period in the year when the New Zealand marketers would come in and offer to supply avocados to the supermarket chains, because there was no unity of supply from the Australian growers,” Mr Donovan said.
“The Avolution was designed to give service to the chains, so they don’t have to go overseas chasing fruit. There is a 12-month supply of fruit here in Australia and if we can manage that supply it helps the whole system.”
Since its formation, The Avolution has secured business with Woolworths, Coles and several 'independents' including premium grocer Thomas Dux.
Mr Allen said the 65 growers that currently supplied fruit to The Avolution benefited from the company’s fully recorded supply chain and quality assurance system, transparency and fixed costs to market fruit, as well as quick payment terms.
“With more growers making the switch to The Avolution, we predict the company will market over three million trays of fruit in the next few years,” Mr Allen said.
Let’s do lunch!
After the success of last year’s inaugural lunch! trade event, the show returns to Sydney next week and will follow with a Melbourne event.
As the food-to-go market continues to defy downward retail trends, lunch! creates the perfect environment to make the most of the industry’s ongoing growth.
With a series of informative, interactive experiences in both cities, those attending will have the opportunity to discover new products, trends and ideas, and network with industry professionals.
lunch! Exhibition Manager Minnie Constan said the event “is about supporting the industry to help it evolve and improve, and our range of exhibitors and special events give business owners and managers the skills they need to succeed in a rapidly growing and changing market.”
Special attractions at the shows include:
The Working lunch! Business Theatre: Australian and international food-to-go experts discuss and debate current convenience foodservice issues including costs, marketing, shop layout/design and food-to-go trends.
The Menu Ideas Academy: practical sessions demonstrating how to use everyday ingredients in unique ways to create delicious but profitable takeaway products. Sessions will cover wraps, soups, salads, international food and breakfast.
The Great Australian Sandwichship: a fast-paced competition that sees some of the best sandwich ‘artistes’ compete to create the tastiest and most creative sandwich or wrap.
The Australian Smoothie and Juice Championship: the best smoothie makers will battle it out for the title of Australian Smoothie and Juice Champion.
When and where: June 24-25, Royal Hall of Industries, Moore Park, Sydney.
Australia’s youth embrace zombie apocalypse
Pre-paid mobile brand Boost has played to Gen Y’s zombie obsession with three entertaining short films available online.
Achieving a staggering 200,000 hits on YouTube in their first four days, the films' action-packed scenes depict the lives of four young Australian heroes trying to survive in a post-apocalyptic world, fighting off the zombies they don’t want to become and using their smartphones to stick together.
The 'Stay Living'campaign was created to promote Boost Mobile – claimed to be Australia’s leading youth-focused pre-paid mobile company – and its competitive UNLTD deals.
Referring to the success of the short films, Boost Mobile CEO Paul O’Neile said they offered the kind of engaging and entertaining content this young audience was now looking for.
The content, he said, was distinguishable and clearly fantasy-fiction, providing a clear metaphor for Boost Mobile's UNLTD pre-paid service, which "enables our customers to ‘Stay Living’".
“At Boost Mobile, we believe your mobile phone plan shouldn’t control your life or make you feel trapped," he said.
“Our Stay Living campaign represents young Boost Mobile customers as the champions of the living. The films have been created to represent the battle between living a fulfilling, free and exciting life and being a slave to the conformity.”
The short films are available exclusively via online channels on television and in-store.
Four’N Twenty launches Footy Bingo
The iconic pie maker is launching a new online game for AFL and NRL fans based on guessing the position of the ball as it goes through the goalposts.
Fans can win a range of "money-can’t-buy footy experiences" valued at more than $130,000 by picking where the ball passes through the goalposts for the first goal during Friday night’s AFL game, or the first score between the big sticks on Saturday night’s NRL game.
The easy-to‐use interactive game can be played online via desktop computer, tablet or mobile phone. The game will be featured in coverage of AFL on Channel 7 and NRL on Fox Sports.
AFL and NRL champions Jonathan Brown and Cameron Smith have been appointed as ambassadors for Four’N Twenty Footy Bingo and will star in a TV commercial promoting the game.
For the chance to play Four’N Twenty Footy Bingo, fans simply enter the unique product code from specially marked ‘Footy Bingo’ packs of Four’N Twenty meat pies, sausage rolls and party products.
Entrants automatically gain one entry into the Four’N Twenty Grand Final Sweepstakes for a chance to win corporate box seats to the 2013 AFL Grand Final or NRL Grand Final.
Four’N Twenty Brand Manager Mark Malak said Footy Bingo combines the fun and luck of bingo, the skill of predicting where the ball will go through the goals, and the wonders of modern technology, to create “an epic battle of man versus square”.
“Four’N twenty has long been the meat pie of choice across all codes of football in Australia," he said. "Here’s a chance for AFL and NRL fans to enjoy Four’N Twenty products, test their luck and skill on a fun new game, and win a whole range of money-can’t-buy footy experiences and prizes. This is a novel and truly unique promotion that we believe all footy fans will love."
The promotion will be supported with a $1 million campaign across TV, radio, digital and social media and PR, and in-store activation and POS.
Retail World – upcoming 2013 editions