Australian Supermarkets Under Fire Over Fresh Produce Pricing
Australian supermarkets are facing increased scrutiny over their pricing practices for fresh produce, particularly the shift towards charging per item rather than by weight. Consumer advocates and independent analyses indicate that these methods can lead to significant price variations and make it challenging for shoppers to compare costs effectively. Industry bodies and government officials acknowledge concerns regarding pricing clarity and consistency.
Pricing Variations and Consumer Challenges
Independent analyses and reviews have highlighted instances where per-item pricing resulted in different effective costs compared to weight-based pricing. A Sydney-based data analyst, who conducted a comparison of online 'per each' prices with in-store 'per kilo' shelf prices for 15 fruits and vegetables at a local Woolworths store, identified notable variations. The analysis calculated effective per-kilo prices by dividing the online item price by the average weight of items measured in-store.
Specific examples of these discrepancies include:
- Green Capsicums: Reportedly priced 51% higher when sold individually online at Woolworths compared to their weight-based price in-store. This translated to an effective online price of approximately $15/kg versus $9.90/kg in-store.
- Red Washed Potatoes: Found to be 30% more expensive when priced per item.
- Broccoli: Conversely, broccoli was reported as 43% cheaper when priced per item. Brown onions were also 39% cheaper per item.
- Other items identified as more expensive per-item included mandarins, limes, and carrots, while red onions, red chillis, red capsicums, black plums, apricots, bananas, and truss tomatoes were found to be cheaper per-item.
A separate review by Guardian Australia identified further examples:
- Bananas: At one Woolworths store, "kids' bananas" weighing 530g were priced at $3.70, equivalent to $6.98 per kilogram. This contrasted with larger Cavendish bananas available nearby at $3.50/kg.
- Cucumbers: A continental cucumber priced at $2.50 each (weighing 340g) was found to cost $7.35 per kilogram, in contrast to Lebanese cucumbers priced at $4.90/kg at the same Woolworths store.
These pricing structures contribute to significant difficulties for shoppers in assessing value, particularly when buying items sold individually.
Supermarket Pricing Practices
Major supermarkets, including Woolworths, Coles, and Aldi, employ various pricing methods:
- Woolworths: Primarily uses weight-based pricing for most in-store fresh produce, with exceptions such as avocados and mangoes. However, for online grocery sales, fresh produce items are typically priced individually. The company has stated it is investigating additional system capability for online pricing.
- Coles: Has initiated a trial to expand per-item pricing for fresh produce in some stores, stating this move is intended to provide clarity on the exact cost at the checkout. The company is collecting feedback on its trial of per-unit apple pricing. Coles sometimes adjusts the final price of produce based on its actual weight for online orders.
- Aldi: Has expanded its use of per-unit pricing in stores, often without displaying per-kilogram prices. Aldi stores do not typically feature scales, which prevents customers from weighing items to calculate per-kilogram costs. Aldi also sometimes adjusts the final price of produce based on its actual weight for online orders.
A Woolworths spokesperson stated that online customers often seek a specific number of produce pieces, and per-item pricing facilitates this. They acknowledged potential "small discrepancies" between per-piece online prices and in-store per-kilo pricing but confirmed no current plans to alter in-store pricing methods.
Regulatory Environment and Calls for Reform
Under current regulations, supermarkets can price fruits and vegetables per unit or per kilogram, irrespective of packaging. There is no mandatory requirement for supermarkets to display a per-kilogram price or the average weight of items when produce is sold individually. This regulatory framework has been identified by analysts as hindering consumers' ability to make informed purchasing decisions and has led to concerns about "shrinkflation," where retailers might source smaller produce while maintaining the same individual price.
Consumer advocacy groups and industry representatives have called for amendments to existing trade measurement legislation and the unit pricing code:
- Queensland Consumers Association: Advocated for limiting or removing retailers' ability to price produce solely per piece, suggesting prices should primarily be displayed and charged per kilo, with estimated per-piece prices as supplementary information.
- Choice: Supported consistent per-kilo pricing as a baseline for consumer price comparisons.
- Australian Competition and Consumer Commission (ACCC): Noted in its supermarkets inquiry report the potential for improving unit pricing consistency. The current unit pricing code's recommendation for displaying unit pricing (average weight and per-kilogram price) for 'per each' items is a suggestion, not a mandatory requirement.
Dario Bulfone from Aumanns greengrocers commented that adjusting prices by actual weight is not technically complex.
Government Response
The Albanese government has committed to strengthening aspects of the unit pricing code. Assistant Competition Minister Andrew Leigh stated that "supermarket prices shouldn’t be a guessing game" and referenced the government's commitment to ensuring clear and accessible information to assist consumer choices. However, no specific reforms directly addressing 'per each' pricing or mandating per-kilogram pricing have been announced by the government at this time.