AvatarForm Posted March 25, 2011 Report Share Posted March 25, 2011 Fosters takes on CML and Woolies: http://www.theage.com.au/business/beer-wars-big-retail-v-fosters-20110322-1c59d.html?comments=69 http://www.abc.net.au/news/stories/2011/03/23/3171105.htm http://news.ninemsn.com.au/article.aspx?id=8227545 http://www.northernstar.com.au/story/2011/03/23/fosters-halts-beer-to-coles-and-woolies/ Now the real question: Can the ACCC (Competition Watchdog) actually bring enough to the table to force a divestiture of either of these multinationals? AUS Law and Regulations are not like others. In AUS, these 2 companies control more than 80% of the retail Liquor, Fuel, Grocery and Clothing and Apparel markets, between them. This is known as an oligopoly. In other countries/economies, this is not allowed. However, sicne these companies funded the re-election of John Howard, they have gained a firm foothold in our nation and basically run everything. Given the ubiquitous nature of the good and services provided by both, it is a simple fact that the majority of ourconsumers do not realise this and this situation creates and illusion of 'competition'. Furthermore, there are many cases where both have been proven to be working together to keep profit margins high. In fact, for every $100 spent in AUS, $28 goes through the tills of either Coles or Woolworths... Your thoughts? Quote Link to comment Share on other sites More sharing options...
Chucklemonkey Posted March 25, 2011 Report Share Posted March 25, 2011 A topic close to my heart on so many levels... Firstly given the long history of competition law worldwide, going back to the oil rush and Sherman act in the US and - very broadly - similar provisions in Europe nationally, prior to the eu taking control of a large amount of European competition law generally, I find it surprising that Australia don't appear to have, from those articles you posted, the case law or regulatory body to deal with it. More surprising to me still that If relying on market forces to keep competition healthy, an approach that has failed historically elsewhere, why some other multi national retailers haven't spotted a gap in the Australian market and moved in. That is perhaps another argument however. Is there no regulatory body in aus to deal with this? SUrely if price wars are occurring there is a real chance of price fixing between the two also? On the other hand I love beer, so why not? Quote Link to comment Share on other sites More sharing options...
James. Posted March 25, 2011 Report Share Posted March 25, 2011 My goodness, woolworths is still open over there? Is it the same woolworths we lost not long ago? I miss woolies As for the rest, I didn't know Australia was like that at all. For all your easy going lifestyles and wonderous golden locks, bouncing in the wind as you catch that next wave, there is an undertone of bribery, price fixing and prime minister buying! Epic! It could make a good mini game that: "In the seedy underworld of Oz, crime and corruption are ripe. Sinister plots and twists abound as you attempt to bring down the system, a system ruthlessly controlled by beer manufacturers and bought politicians. Do you have what it takes to surf or die?" Seriously now though, this is really interesting stuff! I never realised Oz worked so differently. I've always had a soft spot for Australians too, they use a lot of words that are similar to words used in the dialect of my part of England. James. Quote Link to comment Share on other sites More sharing options...
AvatarForm Posted March 25, 2011 Author Report Share Posted March 25, 2011 A topic close to my heart on so many levels... Firstly given the long history of competition law worldwide, going back to the oil rush and Sherman act in the US and - very broadly - similar provisions in Europe nationally, prior to the eu taking control of a large amount of European competition law generally, I find it surprising that Australia don't appear to have, from those articles you posted, the case law or regulatory body to deal with it. More surprising to me still that If relying on market forces to keep competition healthy, an approach that has failed historically elsewhere, why some other multi national retailers haven't spotted a gap in the Australian market and moved in. That is perhaps another argument however. Is there no regulatory body in aus to deal with this? SUrely if price wars are occurring there is a real chance of price fixing between the two also? On the other hand I love beer, so why not? The ACCC is about as dominant as a toothless chihuahua... they never get anything done that really counts. On the topic of Price Fixing: EVery fuel station up and down a road eventually has the same price... just some appear higher, though there is a coupon redemption system. If you shop at Coles/Woolies you get a $0.06 off voucher then buy fuel from them and you get the discount off per Litre of fuel... hence, these Petrol Stations will set "higher" prices, though remain in line with the independents almost to the cent. The problem is in ZONING... for the purposes of "competition" you cannot open more than a set number of grocery/petrol retail outlets within a certain area. Hence, Coles and Woolies flood the area with sites, disallowing competitors to enter. At present the only real threat to them is a buying group under the Independent Grocers of Australia (IGA) flag. Price-wise, they are your local, but you are paying more to have them there. In some major capitals we also have Aldi and a few others breaking in... but it is very slow and may not result in any significant impact. The only direct fire solution is DIVESTITURE. Even is CML/WOW still own the subsidiaries, it will force even internal economies which will cut them down to manageable levels. Not 80% market share. My goodness, woolworths is still open over there? Is it the same woolworths we lost not long ago? I miss woolies As for the rest, I didn't know Australia was like that at all. For all your easy going lifestyles and wonderous golden locks, bouncing in the wind as you catch that next wave, there is an undertone of bribery, price fixing and prime minister buying! Epic! It could make a good mini game that: "In the seedy underworld of Oz, crime and corruption are ripe. Sinister plots and twists abound as you attempt to bring down the system, a system ruthlessly controlled by beer manufacturers and bought politicians. Do you have what it takes to surf or die?" Seriously now though, this is really interesting stuff! I never realised Oz worked so differently. I've always had a soft spot for Australians too, they use a lot of words that are similar to words used in the dialect of my part of England. James. Yes to the above. Quote Link to comment Share on other sites More sharing options...
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