Australian Coles supermarkets have announced that prices on some vegetable product lines will be slashed by up to 50%. AUSVEG, the peak industry body representing Australia’s vegetable and potato industry, say the price cuts are “concerning”. While some vegetable growers stand to benefit from the significant discounting by Coles, AUSVEG is asking the question of where these savings are coming from, and what effect this scheme will have on the greater viability of the industry.
“The drive by the major retailers to capture market share will place an untold amount of pressure on many other growers who aren’t supplying Coles as competitors try to replicate this kind of offer to their customers,” said AUSVEG spokesman, William Churchill.
“The scheme provides some select growers the opportunity to sell higher volumes of produce at a discount and still maintain a successful business – but not all growers are in a position to supply the enormous volumes required to make a profit from these discounted sales,” he said.
The adverse impacts of this kind of campaign will become evident in time, particularly for growers who are committed to other fruit and veg outlets. Ultimately, growers who don’t supply Coles will be left in limbo, says Mr Churchill.