Chief Executive Raewyn Bleakley has responded to media enquiries following grocery retailer, Supie, claiming some suppliers appeared to pressure Supie to increase food prices.
The Food and Grocery Council determined no evidence to support allegations that large supermarkets are potentially pressuring suppliers over pricing.
Instead, Bleakley suggested that two supermarket operators were behind this. By email, Bleakley told investors that these allegations were impacting the market. However, she had seen a pushback from these as multiple suppliers reached out to the FGC concerned that the prices were competitive with the duopoly (Foodstuffs and Woolworths) and demanded an increase in retail pricing despite maintaining reasonable profit margins.
Bleakley shared that when FGC was made aware of Supie’s concerns, she responded by reminding members of their obligations under the law and providing them with the Commerce Commission’s guidance.
“The issue of resale price maintenance is a serious infringement of the Commerce Act, even if it is due to retailer pressure, and we were concerned to urgently make sure the supplier sector understands this and its obligations around it,” said Bleakley.
Bleakley elaborated, stating that the Commerce Commission guidance was thorough and precise. The FGC committed to running a webinar on the issue and addressing the recent advice on the misuse of power.
“This is a highly competitive market, and suppliers are under pressure on many fronts, which means they must be more mindful of what they can and cannot do.”
Furthermore, Bleakley shared that suppliers had yet to report any pressure on pricing from the major retailers to FGC. However, the FGC would continue to work with its members as the Grocery Code of Conduct is introduced.
