Competition regulator warns supermarkets

Natasha Bita
The Australian
April 02, 2012

SUPERMARKETS risk prosecution if they favour their “private labels” to disadvantage other grocery brands, the competition regulator warned yesterday.

Australian Competition & Consumer Commission chairman Rod Sims said he was monitoring the supermarkets for any misuse of market power.

“If supermarkets are selling their own goods alongside other people’s goods, they need to make sure they are not misusing their power as a supermarket to favour their own goods at the expense of others,” he told The Australian.

An Australian Consumers Association investigation in Choice magazine today claims that Coles and Woolworths use “copycat packaging” and poor shelf positioning to give their private labels an advantage over established brands.

“When two brands compete for space on the shelf, and when one of those brands is owned by the supermarket, it’s not hard to figure out who the winner is going to be,” Choice spokeswoman Ingrid Just said yesterday.

Ms Just said one in four brands sold in the major supermarkets was now a cheaper generic “home brand” label, which “may be a good thing” for consumers trying to save money.

“For the shopper who wants an independent product, however, their choices become more limited,” she said.

“If you go to a supermarket and your favourite brand of marmalade isn’t available any longer, tell the store or go somewhere else.”

Ms Just said some private labels were “almost copies” of the big-name brands.

The Choice report shows an orange-packaged Coles sunscreen that looks similar to a Cancer Council brand, Woolworths chips in a green packet similar to rival brand Grain Waves, and Coles nuts with a picture on the packet similar to high-profile rival Nobby’s Nuts.

But none of the established brand owners was willing to discuss the similarities, or take action on copyright or trademarks.