Image for Convenience stores left to go stale in bread barney

Supermarket conduct, with discount bread and alleged misleading of consumers, is damaging smaller convenience operators. With changes by bread manufacturers to trading terms and supply arrangements, it is estimated one in five independent convenience stores has stopped selling bread.

According to the Australasian Convenience and Petroleum Marketers Association (ACAPMA), which represents petrol convenience operators, deliveries to convenience operators have become uneconomical as a result of the trading terms and conditions major supermarkets’ have placed on the bread supply companies.

“As a consequence of the price and supply chain pressure major retailers have placed on bread manufacturers, it was only a matter of time before smaller independent stores became collateral damage in this bun fight,” said ACAPMA CEO, Mr Nic Moulis.

“Convenience store owners, especially in regional Australia, no longer get fresh daily deliveries, are no longer able to return unsold products and in many cases no longer sell bread at all.

“We are continually being told that supermarkets selling bread at a lower price is not for an anti-competitive purpose. The terms and supply conditions placed on manufacturers by major retailers have had an adverse reaction that has rolled through to others.

“I can assure you this has had an anti-competitive effect.”

If the Coalition wins the September Federal Election ACAPMA is hopeful that the promised ‘Root and Branch’ review of the Competition and Consumer Act 2010 (the Act) occurs within the first 100 days. The Association believes that the review’s Terms of Reference will need to include an investigation of all provisions under section 46, Misuse of Market Power, within the Act, to address this kind of flow on affect giant clients, like supermarkets, can create in an industry.

“The Coalition’s root and branch review of competition policy cannot come soon enough,” said Mr Moulis.

“The terms of reference need to include a long hard look at section 46 of the Competition and Consumer Act.

“Current interpretation of the below cost selling and anti-competitive purpose provisions in this section of the Act deny small business the opportunity to have the ACCC effectively take action.

“The result is that situations such as this reward major businesses in the short term only to the determent of competition and the consumer in the long term. It is my belief that this same apprehension is not only held by independent retailers.

“Independent convenience store operators used to live off bread and milk. Now they are starving to sell either product.”

Background:

The Australasian Convenience and Petroleum Marketers Association (ACAPMA) is a not-for-profit employer organisation that has represented the interests of businesses in the petroleum distribution and petrol convenience industries for over 38 years.

As the leading association and national peak body responsible for the development and growth of the petroleum distribution and petrol convenience retail industries, ACAPMA members include over 90 percent of the 120 businesses that operate in petroleum distribution and storage, while representing - through direct ownership, operation or supply – over 3,500 service stations. ACAPMA’s membership profile in the main is independent small-to-medium businesses operating in metropolitan as well as regional and rural Australia.