Woolworths Australia under investigation for same Bully Boy tactics as Countdown

Countdown claimed to be exonerated despite 91 complaints against them, after a report and investigation from the Commerce Commission.

Woolworths in Australia has the same owners as Progressive/Countdown in NZ  and our Commerce Commission let them off the hook after Shane Jones claims.

Woolworths is now being accused of the same bully boy Maia style standover tactics as has recently occurred in New Zealand and the Australian regulators are investigating.

WOOLWORTHS buyers have told suppliers their products could be pulled from shelves just days before Christmas if they refuse to fund the supermarket giant’s new Cheap Cheap advertising campaign.

“I was asked for a contribution of almost $1 million, and when I refused to pay I was told a ‘range review’ was underway and I would be informed of the outcome early next week,” said the sales manager of one of Australia’s leading health product companies.

“The implied threat is that some of my products will no longer be stocked if I don’t pay up.”

Woolworths staff have also been accused of telling suppliers the payment requests had the “endorsement” of the Australian Consumer and Competition Commission (ACCC) – a claim that the consumer watchdog rejects.  

“We don’t intend to provide further comments on this specific matter. Generally speaking though, we can confirm that the ACCC does not have a practice (outside formal processes such as authorisation) of endorsing or approving conduct,” said an ACCC spokesperson.

Fairfax Media can reveal the ACCC has now assigned one of Australia’s most experienced investigators to probe claims that Woolworths is engaging in unconscionable conduct by demanding suppliers pay tens of millions of dollars by the end of December.

The team, which is being led by veteran ACCC enforcement manager Alan Ducret, has promised to provide whistleblower protection in return for information from suppliers.

Mr Ducret led the ACCC’s successful investigation into Coles for unconscionable conduct in its dealings with suppliers. This week Coles requested to settle that similar case and paid a $10 million fine.

No suppliers who assisted with that ACCC investigation have been identified.

I wonder if the Commerce Commission in New Zelaand is watching this case closely with a view to re-opening their one into Countdown should the Australian investigation makes more progress than their own investigations.

It seems incongrous thought that the same organisation on both sides of the Tasman have had the same sorts of accusations levelled against them.

Where there is smoke there is fire.

 

– The Land

 

 


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  • Chris EM

    I’m pretty dismayed and disgusted with our Commerce Commission, it’s quite obvious what is going on here, but they say, ‘Nah, it’s all good.’ There was a time when supermarkets had the cheapest prices because of their buying power, but now they use this power to bully their suppliers and cheat their customers.
    I have seen the same NZ grown apples at more than twice the price in the supermarket than they were down the road at a small fruit and vegie place. I’ve not bought fruit and veg from the supermarket since.
    Dairies manage to sell the same brand of milk cheaper than the supermarket.
    Christchurch company Couplands has an operation in Hamilton now. They can deliver bread to dairies and the like in south Auckland and south Waikato, and these places retail it for one dollar per loaf. Nice stuff with grain and goodness in it, too.
    I think people need to plan their shopping a bit more, and start avoiding the big conglomerates.
    I’ve been using supermarkets less and less over the last couple of years.

  • Whafe

    This is for sure one of those topics that no one really wishes to tackle, in order to tackle it, some very mature adult conversations would need to take place…

    This pretty much sums it up really:

    “I was asked for a contribution of almost $1 million, and when I refused to pay I was told a ‘range review’ was underway and I would be informed of the outcome early next week,”
    Many would not see this as threatening, which I would love to grasp an understanding as to how that could not be seen or felt as threataning…….
    These conversations from Progressive / Countdown in NZ are a common occurance.

  • steve and monique

    Just because our inept Commerce Commission didn’t find them guilty it doesn’t mean they aren’t. I was a rep for many years and always found the Progressive chain of stores particularly frustrating to deal with. Always had the holier than thou attitude even when their sales dictated the contrary. They always seemed to want something for nothing and it would not surprise me at all if this was going on, it certainly would have in NZ of that I am sure. Time for the CC to do some proper investigations, many would have been too scared to talk and it’s their job to find a way. As Cam said where there is smoke there is fire. Reopen it CC and this time do it properly

    • Platinum Fox

      It’s pretty obvious to a disinterested observer (other than being a consumer) that it’s an unequal negotiation for most suppliers. One of the few who has the upper hand at the moment is the supplier of that chocolate milk which is only available in limited quantity.

      Part of the problem for fresh food suppliers will be that the supermarket chains don’t buy fruit and veg at the daily auctions (and maybe not fish and meat?), rather they want certainty on availability and volume and use that to preserve [or even opportunistically grow] their own margins.

  • Kiwibabe

    It’s called business. Many businesses treat their suppliers, well, they seek perpetually lower prices than yesteryear. I know from having been involved that Telecom deal to their services contractors big time, have done for many years. I have been told of the way The Warehouse deal with, more like to their suppliers. Not nice. In construction subcontractors get dealt to taking advantage of their weak business and commercial skills. Some effort is being put into improving costs from the “supply chain” of the Chch rebuild, ie steps to maximise competition.
    Its all about reducing costs to the end buyer, and in the case of retailers that means the public at large.
    Competition as nasty as it is reality, and forces companies to become more efficient by maximising productivity, containing costs, and delivering better service and quality.
    We all benefit from this in the end, which is why it is not the governments job to suppress competition.

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