Fact-checking @coles and @woolworths for #SPCsunday, by @adropex

Lesley Howard

Lesley Howard

Citizen Journalist at No Fibs
Lesley has a keen interest in supporting sound environmental social practice, and works pro bono for Western Chances and ACF as required. She is undertaking a Masters of Science, Applied Statistics.
Lesley Howard
- 7 hours ago
Lesley Howard
Lesley graduated from the University of Melbourne with dual majors in Statistics and History and Philosophy of Science. The combination of the two fields formed a strong background in objective research, critical appraisal and the analysis of relationships, and in assessment and reporting.With this skill base she has variously consulted for an Australian timber company analysing the unloading of logs in Chinese ports, reported on the role of SMEs in Defence, critically analysed scientific papers, designed and advised on surveys and sampling for various private and government groups, and reviewed and advised on research proposals as a member of the Royal Melbourne Hospital’s MHREC.Lesley has a keen interested in supporting sound environmental social practice, and works pro bono for Western Chances and ACF as required. She is undertaking a Masters of Science , Applied Statistics.

spc-sunday-coles

By Lesley Howard @adropex

9th February 2014 (Updated 11 February 2014)

BACKGROUND 

In a tweet to me @Coles said, “around 90% of our Coles Brand Food and drink is Australian made”. I asked them to “confirm for me that about 90% of Coles own brands are 100% Aus product.” In response they politely referred me to their website. Such detail of information is not available on their website.

Given the situation with SPCA and the dominant market share (approx 80%) of Coles and Woolworths I got curious as to whether this duopoly has a responsibility in the demise of Australian products and SPCA itself.  I did a quick but not definitive survey, of some products to get an idea. Regarding @Coles claim in a tweet to @margo kingston1 that “Coles is a strong supporter of SPC Ardmona with more than 170 private label & branded products on our shelves” it is impossible to verify this from readily available figures. Whilst SPCA branded products are listed on the website, information about private label manufacturers is not.

Figures were sourced from the Coles and Woolworths online. Coles includes where the product is from on their website but Woolworths does not. Unless Woolworths specifically identify a product origin on the label, as they do with tomatoes and some fruits, it is impossible to know where it comes from without a trip to the supermarket to read the fine print on the label. I went to two Woolworths supermarkets and found the origin of some of their own brand products. Price comparison figures are based on the 400g to 425g products as a standard size.

Figures marked with an* still need to be verified so are not to be taken as a given. 

BAKED BEANS

Baked Beans

Home Brands

SPC

Heinz

Others

Total

Aus

Mixed

O/S

Aus

NZ

Aus

Mixed

O/S

Coles

6

2

8

21

1

2

2

42

Woolworths

1

1

9

24

1

2

38

 

Total

7

3

17

45

2

2

4

80

Coles: 0% of own brands were Australian products. 21.4% of total stocks were Australian products and 19% of total stock had some Australian content. 

Woolworths: 0% of own brands were Australian products. 26.3% of total stocks were Australian products and 2.6% of total stock had some Australian content.

Combined: 0% of home brands were Australian products. 23.8% of total stocks were Australian products and 11.3% of total stock had some Australian content.

BAKED BEANS PRICE COMPARISON

Italics indicates generic home brand

Outlet

Brand

Produced

Price $

$/100g

On Special

W

Homebrand

O/S

0.77/420g

0.18

 

C

Smart buy

Italy

0.91/420g

0.22

 

C

Coles

Aus+O/S

1.00/425g

0.24

 

W

Select

Aus+O/S

1.00/420g

0.24

 

W

SPC

Aus

1.40/425g

0.33

$1.30

W

Watties

NZ

1.45/420g

0.35

C

Watties

NZ

1.46/420g

0.35

C

Organic

Italy

1.63/400g

0.41

 

C

SPC

Aus

1.94/425g

0.46

W

Heinz

NZ

1.99/420g

0.47

C

Heinz

NZ

2.01/420g

0.47

$0.92

CANNED SPAGHETTI

Canned

Spaghetti

Home Brands

SPC

Heinz

Others

Total

Aus

Mixed

O/S

Aus

NZ

Aus

Mixed

O/S

Coles

3

1

2

9

16

2

33

Woolworths

1

1

8

17

3

30

 

Total

4

1

3

17

33

5

63

Coles: 50% of own brands were Australian products. 36.4% of total stocks were Australian products and 3% of total stock had some Australian content. 

Woolworths: 50% of own brands were Australian products. 30% of total stocks were Australian products and 0% of total stock had some Australian content.

Combined: 50% of home brands were Australian products. 33.3% of total stocks were Australian products and 1.6% of total stock had some Australian content.


SPAGHETTI PRICE COMPARISON

Italics indicates generic home brand

Outlet

Brand

Produced

Price $

$/100g

On Special

W

Homebrand

Italy

0.77/420g

0.18

 

C

Smart buy

Italy

0.91/420g

0.22

 

C

Coles

Aus

1.00/425g

0.24

 

W

Select

Aus

1.00/420g

0.24

 

W

SPC

Aus

1.40/425g

0.33

$1.30

C

Watties

NZ

1.46/420g

0.35

C

Organic

Italy

1.63/400g

0.41

 

C

SPC

Aus

1.94/425g

0.46

W

Heinz

NZ

1.99/420g

0.47

C

Heinz

NZ

2.01/420g

0.47

$0.92

CANNED TOMATOES

Canned

Tomatoes

Home Brands

Ardmona

Others

Total

Aus

Mixed

Italy

Aus

Aus

Mixed

Italy

Coles

1

10

10

4

25

Woolworths

1

1

13

8

1

9

33

 

Total

2

1

23

18

1

1

13

58

Coles: 9.1% of own brands were Australian products. 44% of total stocks were Australian products and 0% of total stock had some Australian content.

Woolworths: 6.7% of own brands were Australian products. 26.7% of total stocks were Australian products and 6.1% of total stock had some Australian content.

Combined: 7.7% of home brands were Australian products. 36.2% of total stocks were Australian products and 3.4% of total stock had some Australian content.
CANNED TOMATOES PRICE COMPARISON

Italics indicates generic home brand

Outlet

Brand

Produced

Price $

$/Kg

On Special

W

Homebrand

Italy

0.65/400g

1.61

 

C

Smart buy

Italy

0.71/400g

1.78

 

C

Coles

Italy

0.80/400g

2.00

 

W

Val Verde

Italy

1.00/400g

2.50

C

Coles

Aus

1.07/400g

2.68

 

C

Organic

Italy

1.19/400g

2.98

 

W

Macro

Italy

1.25/400g

3.13

 

W

Ardmona

Aus

1.40/400g

3.50

C

Ardmona

Aus

1.40/400g

3.50

W

Select

Italy

1.49/400g

3.71

 

C

Capriccio

Italy

1.51/400g

3.78

$1.00

W

Annalise

Italy

1.71/400g

4.28

C

Mutti

Italy

2.01/400g

5.03

PROCESSED FRUIT PRODUCTS

It is very hard to make comparisons across such a vast array of products especially as SPCA does not produce all fruits and combination of fruit products available. Given that Woolworths does not include country of source on their website it would be an onerous and time consuming task to inventory products by hand. Canned peaches seem to be the iconic SPCA product so I have surveyed peach products stocked by Coles and Woolworths and I have included a very general comparison of all home brand fruit products and SPCA fruit products excluding fruit juices.

Processed

Fruits

Home Brands

Total

SPCA

Total

Aus

Mixed

O/S

SPC

Goulburn

Ardmona

Coles

17

2

22

41

24

28

2

54

Woolworths

11

17*

28

18

25

2

45

 

Total

28

2

39*

69

42

53

4

99

For every home brand product Coles stocks 1.32 SPCA products.

For every home brand product Woolworths stocks 1.61 products.


PROCESSED PEACHES

Processed

Peaches

Home Brands

GV/SPC

Others

Total

Aus

Mixed

O/S

Aus

Aus

Mixed

O/S

Coles

2

3

13

3

1

22

Woolworths

3

8*

9

3

23

 

Total

5

11*

22

6

1

45

Coles: 40% of own brands were Australian products. 68.1% of total stocks were Australian products and 0% of total stock had some Australian content.

 Woolworths: 27.2%* of own brands were Australian products. 26.1%*of total stocks were Australian products and 0% of total stock had some Australian content.

Combined: 45.5%* of home brands were Australian products. 60%* of total stocks were Australian products and 0%* of total stock had some Australian content. 

*I was unable to confirm Woolworths figures as the two supermarkets I went to were out of home brand peaches.  Generally their “Select” brands of canned fruit are Australian but their “Homebrand” is sourced from overseas. If this holds true for peaches then the above figures would be indicative.


CANNED PEACHS PRICE COMPARISON

Italics indicates generic home brand

Outlet

Brand

Produced

Price $

$/Kg

On Special

W

Select

Aus

2.03/410g

4.95

 

C

Coles

 

2.05/410g

5.00

 

C

Goulburn V.

Aus

3.24/400g

8.10

W

Goulburn V.

Aus

3.28/400g

8.20

The 400g to 425g container is a standard size and I have used it as a comparison size across brands and outlets. I chose this as the comparison size to ensure niche markets for snack products etc do not influence a basic comparison.

Coles does not list any SPC products in the core 400g to 425g range unless they are bulk packed in multiples of three. In a tweet today @Coles said that “100% of Coles brand tinned peaches, pears and apricots are sourced from SPC”. This is confusing given that they list Coles Smart Buy brand of canned peaches as South African sourced.

Whilst I have not had any direct contact with Woolworths it is interesting to note the similarity and limitations of the products they offer in this category. It would also be interesting to know if they too sourced the same products from SPC.


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Comments

  1. Errol Brandt says:

    Good analysis Lesley.

    The figure of 80% of the packaged grocery market is about right. If you include fresh fruit and produce the figure drops to around 60%. In this case we’re talking about packaged goods, so 80% is comparable. http://theconversation.com/factcheck-do-coles-and-woolies-control-80-of-the-market-15418

    A high proportion of Australian produced private label is not necessarily a good thing. It’s really something that a company like SPCA would do only out of desperation. These private label contracts are onerous, unrewarding and expose the manufacturer to all sorts of problems around intellectual property.

    If Australia had 4 or 5 major retailers, rather than 2 dominant retailers, companies like SPCA would have much greater bargaining power. As it stands today, dealing with Coles and Woolworths is like negotiating with a gun to your head.

  2. We only have 2 major retailers because people want to shop there. I have an Aldi & IGA closer to me than Woolies or Coles. I go to Woolies. Much better store than & Woolies. Shopping centres that have all 4 retailers. Coles & Woolies packed, IGA & Aldi are not.

    If was yet another new entrant people would still shop at Coles & Woolies. They provide fantastic customer service & value. Other stores don’t

    • Jade, you are obviously not a pensioner or a self funded retiree. I am one of the latter and I do around 70% of my shopping at Aldi about 20% at Coles and a little at Woolworths, the last two mainly for gluten free products which is the only area where they excel.

      Compared to when I was not so price conscious and shopped primarily at the big two, the amount saved buying similar items is incredible. The same fresh squeezed Australian orange juice (same package with a different name sells for $3.99 compared to 6.99 at the others). Mind you I still look for other Australian products and, while Aldi do not carry a large range I try to balance loyalty to Aussie producers with living within my means

  3. Jade, I dont agree with you. The ACCC has been investigating 50 claims of misuse of market power or unconscionable conduct by unnamed managers working for unspecified supermarkets. Small local shops are struggling to compete and consumer’s favourite brands are disappearing from the shelves. Small businesses are important contributors to Australia’s economy. They employ approximately 5 million Australians and make up around 96% of the actively trading businesses in Australia. There is also growing evidence about the tactics the major supermarkets are taking in negotiating agreements with suppliers and processors in the food industry. Successive inquiries have heard evidence of these concerns, yet there has been no effective action. According to the Australian Competition and Consumer Commission (ACCC), prior to them offering confidentiality many farmers and small business people who supply the supermarkets did not want to speak out publicly about their experience as suppliers for fear of any repercussions. The ACCC chairman reported that the investigation had been slowed by the “complexity and breadth of investigations” and by the “challenges associated with gathering evidence while safeguarding the business relationship witnesses have with the supermarket chains”. There are two specific and subtly different points of regulatory inquiry here. First, the ACCC is assessing allegations that employees of the supermarkets have demanded “various payments” from suppliers that are “above and beyond” the routine of the supply chain. At the same time the regulator is assessing whether major chains are misusing their very obvious market power by discriminating in favour of increasingly ubiquitous house brands.
    According to research from Macquarie Private Wealth the pervasiveness of the Coles and Woolworths supermarkets ensures they both build market share against other competitors. Macquarie says that Coles’ and Woolworths’ share of the $112 billion grocery market has increased over the last five years from 48 per cent to 56 per cent.
    Macquarie says the biggest contributor to profit growth is the transfer of profits from the companies that supply products to Coles and Woolworths. The broker estimates that the big two have crunched supplier profit margins by 6 per cent over the last five years in what it describes as ‘‘the ongoing profit transfer from suppliers to retailers’’.

    I also have Woolies, Coles and Aldi to choose from. Aldi often has better prices, but has fewer lines of stock than Coles or Woolworth. In our family we shop at all three. Where Aldi sells alcohol I find it is it is much better value than Woolworths.

  4. maggie atlas says:

    Finally at last no real competition and policies profit agenda’s that I think caused demise of many & the sell off to foreign investors the expanding profits and the shrinking choice & real competition. The globalisation scheme global large corporations have no national loyalty only profit which is the corporatisation globalisation agenda impossible to get to this point without the silence of Global Corporate Main Stream Media and assistance of installed facilitating governments. Fact or fiction right or wrong that is what I believe.

  5. I’ve been trying to make sense of the IGA web site – they too have own brand products and promote black and gold – what percentage of these products are Australian?
    http://www.ethical.org.au/get-informed/issues/supermarkets-in-australia/