Following on from the MTA SA’s support of an ACCC investigation into supermarket fuel offers, the VACC have also declared their strong support.
“In 2003, when Coles entered the fuel retail sector, the VACC said consumers could end up paying more for groceries and in the long-term petrol competition could weaken. In 2013, that is exactly what’s happened,” says VACC executive director, David Purchase.
VACC has welcomed the recent investigation by the Australian Competition and Consumer Commission (ACCC) chairman, Rod Sims, into supermarkets and fuel discounts.
Launching the ACCC Compliance and Enforcement Policy, Sims recently outlined “as a specific area of focus, the ACCC has maintained reference to placing priority on competition and consumer issues arising in highly concentrated sectors, and in particular the supermarkets and fuel sectors”.
In response, VACC has called on Sims to conduct a thorough investigation into supermarkets and their retail fuel partners and in particular, shopper dockets, anti-competitive behaviour and creeping acquisitions.
“We have raised concerns about the retail fuel industry for many years and well before the first shopper docket was introduced in Australia, by Woolworths, in 1996,” says Purchase.
“We have written countless letters and submissions, arranged meetings and promoted our concerns through the media. Finally, the ACCC has heard what we and other independent suppliers and retailers have been saying.”
Among VACC’s 5300 small business members in the retail, service and repair sector of the automotive industry, are approximately 200 independent fuel retailer members. Forty years ago VACC had more than 3000 fuel retailer members. Many have blamed their departure from the industry on anticompetitive behaviour by the supermarkets.
“In little more than a decade, Coles and Woolworths have spread across the Australian retail landscape,” says the VACC.
“They run a near duopoly in the $84 billion grocery industry and enjoy a combined share of around 50% of the retail fuel sector. They control and influence suppliers and cross subsidise across their many outlets through heavily discounted products and promotions.
“On the other hand, independent service station owners are small businesses, price takers, disadvantaged throughout the fuel supply chain, and have little or no opportunity to discount fuel or convenience store items.
“We anticipate the ACCC investigation will not be easy and will have to overcome many hurdles – the supermarket’s legal teams will be well prepared. But this is an important crossroads for Australian suppliers and consumers and it is important Mr Sims is resolute in his pursuit of fair competition,” says Purchase.
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