Daniel Smith: Don’t trade power for convenience even with supermarkets

Do we really want to give our big supermarket retailers more power?

That’s the question we should be asking ourselves in the context of the Australian Competition and Consumer Commission’s recently launched proceedings against Coles and Woolworths.

The ACCC is alleging both companies breached consumer law by misleading consumers through discount pricing claims on hundreds of products.

This is at a time when the ACCC is also investigating the companies’ practices in dealing with farmers and other suppliers.

In its recently released interim report into its ongoing supermarkets inquiry, the ACCC noted that Australia has one of the least competitive supermarket markets in the world, with the share of our two biggest retailers having grown to 67 per cent.

What is not often talked about is that this increasing dominance has occurred as governments around the country have been deregulating trading hours for large retailers. This includes in Western Australia, where more than 20 hours a week of opening hours have been added since 2010.

It may be true that allowing big retailers to open between 9am and 11am on a Sunday, as smaller retailers can choose to do, will attract more international tourists, as some hope.

But, every time we give additional trading hours to the big retailers, we give them more market share at the expense of smaller retailers, with enhanced power over both consumers and suppliers.

Do we really want to do this?

Daniel Smith is executive chair of ReGen Strategic.