Giant Supermarkets Need To Be Regulated

Coles and Woolsworth, two of the biggest Australian chain stores, seem to be invading every town and suburbs that industry observers say that it is probably time for the government to step in and regulate its over development.

These companies are particularly hurting local suppliers in Toowoomba in Queensland, where some say the market share for Coles and Woolsworth is around 90 percent.

The giant chains, which operate supermarkets, hotels, electronic stores, hardware and other shops, have erected five supermarkets each and are still planning to build more outlets, affecting independents in the small town.

In Mount Gambier, where natural reserve is thriving, a new landmark, the $80-million Woolsworths shopping center is about to open next month.

Some locals are not so pleased about this, fearing that it will soon eat up on local commerce.  Mount Gambier is actually geared for more development, as plans to turn some of its areas into more profitable enterprises are underway, including Payless Shoes, Woolworths supermarket and petrol stores and Big W discount store, to name a few.

But Wesfarmers, the company that owns Coles, as well as Kmart and Target, said that the concerns and criticisms are unjust. The company believes that consumers are getting good deals with prices becoming more affordable at their stores.

Its chief executive said that many of the items they sell are Australian made and are sourced locally and he believes that the gripe may be coming from some suppliers that company had to let go.

Meanwhile, another player in the chain store competition, Metcash, is planning to follow in Coles and Woolworths lead by opening a chain of groceries, pubs and hotels.

This is raising a lot alarm bells over the regulatory power of the government and by mid-August, the Senate Select Committee on Australia’s Food Processing Sector is set to make a report on this, while the Australian Competition & Consumer Commission is planning to launch an investigation on these giant chains.