In the midst of a supermarket crackdown, secretive German supermarket giant Aldi has been quizzed by the ACCC.
Research shows Aldi is significantly cheaper than Coles and Woolworths, and it has now been candid as to why.
It says the stores are smaller, they have fewer staff, and they sell fewer items.
“All of those little things ensure that we can keep our costs down and pass that onto the consumer,” Jordan Lack, Managing Director, National Buying, Aldi Australia said.
Aldi bosses today said their supermarket shelves carry a range of only 18,000 hundred items while Coles and Woolworths have more like 20,000 or 25,000.
For example, a shopper looking for raspberry jam at Coles would have seven brands to choose from.
At Woolies, they’d see eight different brands.
At Aldi, there’s one and today the ACCC Inquiry was told that is a big part of how Aldi can be anywhere between 10 per cent and a third less expensive than Coles and Woolworths.
“We believe that incremental range adds costs and complexity through our supply chain,” Lack said.
Australia’s most trusted brands for 2024
Retail expert Gary Mortimer agreed.
“When you’re dealing with less choice and fewer items you’re dealing with fewer suppliers, fewer wholesalers and you get the economies of scale,” he said.
The ACCC will spend the next two weeks grilling the bosses of Aldi, IGA affiliate Metcash, Coles and Woolworths on their pricing strategies.
In February it will hand a final report to the Government explaining if and how Australians are being squeezed at the checkout.
“I don’t think it’ll mean lower prices,” Mortimer, said.
“I think it could mean more transparency.”
In the meantime, international giant Aldi is detailing the case for less choice for consumers.
