Woolworths and Coles are both large Supermarket chains. Both of these chains are looking at increasing prices in order to keep up with rising energy costs. Most of the increase in energy costs comes from refrigeration, but it is not clear yet if the increased prices will only apply to cold foods. A possible solution that Woolworths is considering is a 10 year long contract with suppliers. Coles has already signed a 10 year contract with the Australian Lamb Company.
- Rising energy costs are forcing C-store retailers to transfer costs to consumers and enter into long-term contracts with big suppliers.
- Woolworth’s Mr. Bone expresses that the promotional competition between grocer stores is causing shopping fatigue within customers and is ruining the grocery market.
- C-store retailers will find it difficult in the near future to compete with larger retailers due to consumers’ opinion of private labels and big brand marketing.
““We are trying to outrun a bear” to describe the business position in regard to rising energy costs, in an interview with The Australian.”