On monopolies

Mark writes below of the potential for new media monopolies. There is another type of monopoly which has been growing for sometime.

Have you noticed how many food products that you have bought for a long time are no longer available?

This has been happening a lot to me lately so I started ringing the food manufacturers to find out what’s going on.

Three have now told me, two in a roundabout fashion and one directly, that they are no longer manufacturing a particular product because of Coles & Woolworths. They said if these two chains won’t stock a product then there is no point in making it anymore.

Welcome to world of growing monopolies be it food, the media or petrol, where choice is becoming an obsolete word.

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81 Responses to “On monopolies”


  1. 1 JCNo Gravatar

    Ron

    Let’s look at the carefully. Coles and Woolies are in the business of satisfying the consumer. If they don’t they go bust. Fact.

    There are two issues that need to be considered about the food preferences you mention.
    1. Coles and Woolies made a mistake by withdrawing the foods you liked in so much as their computers did not tally the correct number of items sold.

    2. Other than you, no one else was buying the stuff. (Not just you but not enough people).

    In the computer age I would guess that the ordering issues are left to computers to talk to computers of the manufacturers. So a mistake by both stores is unlikely. We are therefore left to ponder that there just wasn’t enough demand to fill the shelf and as shelf space has value they took it off.

    So where does the question of monopoly power come into this. Business is doing what it does best, which is to gauge consumer taste and then bring it to the market. Think the reverse for a better pic. Would either of the two companies withdraw the product if it were selling like hot cakes? Most likely they would have added more shelf space to cater for demand.

    Monopolies can only survive when governments license allows it to exist by legislating exclusion, otherwise a monopoly cannot exist. It is impossible in economics.

  2. 2 RonNo Gravatar

    “Coles and Woolies are in the business of satisfying the consumer”

    I don’t believe this is the case when you have two monopolistic companies like these. They can force you to buy what they stock and that is the reason their company-labelled products are getting greater shelfspace.

    It doesn’t take long on Google to find plenty of evidence to support my case of the shrinkage of choice. Here’s just one.

  3. 3 JCNo Gravatar

    Ron

    But generics are what people are demanding because they are cheaper and the brands cost more money. That’s what’s happening in the supermarket world. People are choosing not to spend extra for a tube of colgate if they have tried and found the generic to be fine.

    You are cofusing comsumer tastes again. To score this point even further the big spuer markets are under threat by that german group which mostly sells its own brands to people who want to buy cheaper. They are under pressure as well. This is good.

  4. 4 Gummo TrotskyNo Gravatar

    Joe,

    How does the fact that Coles and Woolies charge at both ends fit into your classic analysis? Besides charging retail customers for the stuff they put in their trolleys, both chains charge their suppliers for favoured shelf positions, display stands etc - usually by demanding a discount on supply. The market dominance of Coles/Myer extends so far that they can even dictate to suppliers how warehouses are to be managed. Sorry, that last bit is anecdotal and apocryphal.

  5. 5 Tony HealyNo Gravatar

    JC, the issue is that Coles and Woolworths can use their control of the retail outlet, and the lack of competitors, to determine the mix of goods available to the consumer.

    They have been engaged in a long standing program of developing their own house brands to capture the low end of various product markets, and then gradually expand upwards to capture more of the market.

    It is often in their interest to cease stocking competing brands or similar products, since consumers will be forced to shift to the house brands that earn additional revenue for Coles and Woolworths. A refinement of this tactic is to charge exorbitant shelf space rents to competing brands for the privilege of being displayed in Coles and Woolworths stores.

  6. 6 JCNo Gravatar

    Well Trot ( I sure wish …. i’ll leave at that)

    Trot you are double counting. The two firms are not charging at both ends in a real sense. They are purchasing the products at a cheaper price. They can bargain the manufacturer down at a cheaper price by promising better shelf space. I find this to be perfectly acceptable and so does the manu., it seems. Better shelf space, which has premium value, means more stuff out the door. Premium space has value because by definition it is valuable- there isn’t much of it. The manufacturer could opt for lesser quality space of course but he chooses to better quality, as he wants to sell much more.

    I see the grocery business as an extremely complicate form of game theory and probability that would take a long time to get a handle on it.

    Both these firms could very well be making a big mistake selling generics. We don’t know yet. They probably don’t know either. However they know they have a potentially dangerous competitor in that German group so they are trying out different stuff. In other words they are in a constant state of experimentation.

    But to say they have reduced product range because they are a monopoly is simplistic at best.

    The reason they took Ron’s tasties off the shelf is not because they don’t like Ron. There just wasn’t enough Ron’s who were buying stuff Ron likes.

  7. 7 csNo Gravatar

    Coles and Woolies are in the business of satisfying the consumer. If they don’t they go bust. Fact.

    Advertising claptrap. Why on earth do they have to ’satisfy’ their customers at all? Where is the evidence that they even try? I’m never satisfied by Coles or Woolies. The real motto is:

    “Coles and Woolies are in the business of making as much money as possible, and will piss off their consumers as much as they possibly can whenever they can make a buck out of it, stopping just short of pissing them off so hugely and permanently in such large numbers that they will go to all the extra cost and inconvenience of trying to find an alternative place to shop. If they blow the fine line between day-to-day common and garden variety pissing consumers off and really permanently pissing them off, too often, at too many stores, they could go bust, if they don’t correct the extreme annoyances in time, which they probably will because by and large they know where they are pissing customers off and where they can get away with it, so you can’t beat them, even though you are always dissatisfied. Fact.”

  8. 8 F. David BowerNo Gravatar

    I thought the concept of economies of scale creating effective (if not actual, illegal) monopolies was well established.

    That there is always a certain unease in the relationship between what customers REALLY want and what the retailer wants them to want.

    And lastly that the retailer can get away with a fairly large disparity between the two if their market share is big enough.

    Oh well, I guess you unlearn something new every day. Better JC’s romantic notion of the caring sharing greengrocer, travelling the countryside to bring us the finest, freshest produce we want at a price we can afford.

  9. 9 JCNo Gravatar

    “JC, the issue is that Coles and Woolworths can use their control of the retail outlet, and the lack of competitors, to determine the mix of goods available to the consumer.”

    No, that only happened ion the soviet union. We choose what we want to buy.

    “They have been engaged in a long standing program of developing their own house brands to capture the low end of various product markets, and then gradually expand upwards to capture more of the market”.

    Ok, that’s because people were wanting cheaper products. This in effect meansd that lot’s of groceries have become commoditized in that consumers are unwuilling to buy brand names if they aren’t better than generics.

    You bought medicnes of late. Most Chemists now offer a generic against the brand telling you it will be cheaper and exactly the same. That’s waht the big groceries are doing. Same thing.

    “It is often in their interest to cease stocking competing brands or similar products, since consumers will be forced to shift to the house brands that earn additional revenue for Coles and Woolworths.”
    They are n’t forced to shift to anything. If wollies doesn’t stock it, Cloes will take up the slack or someone else will.

    “A refinement of this tactic is to charge exorbitant shelf space rents to competing brands for the privilege of being displayed in Coles and Woolworths stores”

    I someone is willing to pay for it, then by defiction it can’t be exorbident.

  10. 10 F. David BowerNo Gravatar

    Oh yeah, and aren’t the terms anecdotal and apocryphal mutually exclusive?

  11. 11 JCNo Gravatar

    No David. Stop putting word in my mouth. it’s dishonest and misleading.

    Both these companies are neither angels nor demons. Their mission is to serve the customer as best they can and earn a profit for the shareholder.

    If they don’t do that they go bust. GM is the US is a case in point. Once a large comapany now a very small one because they lost sight of the customer.

    Have any of you guys ever worked as executives in private companies for any length of time?

    Trot, what about you?

  12. 12 ChrisNo Gravatar

    I’ve been struck by this recently, and its been irking me no end. I lived overseas for a long period of time, and my first complaint was “there is no product range”. There was a similar duopoly, and the shops sold two brands of orange juice, maybe two brands of tomatoe paste, one brand of peanut butter etc It wasn’t untill I returned to Australia that I realised that despite this, the variety of products in Australia is actually more limited.

    For example, while overseas I could buy 10 different jams, there might only be one manufacturer for each flavour on the shelf. In Australia you can get perhaps 5 flavours, but each made by 5 different manufacturers. Strawberry, apricot, rasberry, blackberry (or “fruits of the forest”)… and then its pot luck. For a more solid example, its the same with yoghurt: strawberry, fruit salad, vanilla, fruits of the forrest and….? Ok, how about: lemon, blood orange, kiwi and bannana, rhubarb, coffee, chocolate, caramel, grape, apple strudel, maple, pistacio, hazelnut, walnut, mango, apple, banana, chestnut, raspberry, blueberry, oh and vanilla - all full fat. Then in greek style: honey, plain, fig and almond. Then again in low fat… But only from one or max two manufacturers in the one shop.

    JC: blind faith in the “free market” huh? Essentially two monopoly players doesn’t really constitute a free market. I see really little difference between what coles and woolworths offer, and suspect its external factors which drive which supermarket people visit e.g. which is closest, or most convienient. If this is the case, there is little incentive for them to try and gain marginal improvements in customer numbers through a broader product range. The German chain you are referring to is Aldi.

  13. 13 RonNo Gravatar

    “finest, freshest produce”

    Now that’s a whole different topic when it comes to Coles and Woolworths!

  14. 14 RonNo Gravatar

    Generics are no longer the cheapest products. Coles have three levels of generics with the top one as dear or dearer than brand names.

    Many of Coles generics are imported, even their frozen vegetables, which is another topic too.

  15. 15 Pavlov's CatNo Gravatar

    CS, brilliant translation of supermarket motto, bang-on.

    Anecdotal and apocryphal are not really antonyms. The anecdotal often develops into the apocryphal.

    JC — I know it was a genuine typo, but there is far more truth in ’spuer market’ than in what you actually intended to type.

  16. 16 csNo Gravatar

    Their mission is to serve the customer as best they can and earn a profit for the shareholder.

    Only the latter is true, and even it might now be in doubt, as recent studies have shown ceo salaries have been increasing regardless of returns to shareholders. And they plainly do not “serve the customer as best they can”, Joe Pollyanna. Obviously you have never spent any time in these stores Joe, as then you would know that they serve the customer as badly as they can get away with.

  17. 17 JCNo Gravatar

    I tell you what guys. And I am not joking here. There are plenty of very large chains around the world that would love to see an opening to expand, as this is a mature and very unsexy business.

    Of you think there is an opening, put your “collective” heads together and make a proposal to them. If it were good enough they would jump at the chance because, to be honest, the capital outlay for a store is very small as most work on credit.

    Put together a business plan and show it to me. i can assure you it will ge to a few big names around the traps and if it’s a goer it is a win win situation for all of you.

    Yoiu crack the two companies over the head, give the consumer a better service and make some quick bucks along the way, which you can then donate to Greenpeace or whatever. Maybe even pocket most of it. You won’t have to run it as I am sure they will provide the expertise for that. You may need some seed capital, but the idea is mnore important and you would be rewarded for that.

    So let’s do it.

    Chris says
    JC: blind faith in the “free market� huh?

    And the solution is what exactly, Chris. Lining up at the meat market for three hours to get a pound of old meat?

    What’s your solution, big guy

  18. 18 James HamiltonNo Gravatar

    Meanwhile I go into inner urban elite out of touch specialty stores (purely for research you understand) and I am absolutely gobsmacked at the range of good and ingredients on offer.

    Monoploistic supermarkets leading to less choice? Somebody forgot to tell Simon Johnson and about 500 oriental food stores.

  19. 19 csNo Gravatar

    And the solution is what exactly, Chris. Lining up at the meat market for three hours to get a pound of old meat?

    Apologies Joe. Obviously you have been to Coles and Woolies lately, although you do have to be lucky to get there when there is any meat left to line up for.

  20. 20 JCNo Gravatar

    CS

    The secret of marriage is that one is never forced to do the mundane stuff if it can be negotiated and avoided. So far I have succeeded, but I think my luck is starting to run out. So, I might see you at the check, dude.

    The very few times I been in a supermarket…. I must say there are terrific looking gals shopping there. It was fun looking around. I might do it again sometime.

    Before you accuse me of bias the inhouse deal is that I look after the cars etc. and Ms. wife does the shopping as I always come home with the wrong brand of fucking milk. Milk has a brand now……

  21. 21 Gummo TrotskyNo Gravatar

    And the solution is what exactly, Chris. Lining up at the meat market for three hours to get a pound of old meat?

    Blimey, what kind of markets do you have round your neck of the woods Joe? The Melbourne alternative to buying meat at supermarkets is either -

    A local butcher, if you’re lucky enough to have one.

    The Meat Market at Queen Vic (if you’re inner suburban enough). Guaranteed, you’ll never queue 3 hours there and you have a choice of several butchers all aggressively competing on price, quality and OK, occasionally, short weight.

    Either way, you don’t have to be stuck with the cuts your supermarket chain has decided are sellers - get to know your butcher and they might start cutting stuff to order.

  22. 22 JCNo Gravatar

    “The very few times I have been in a supermarket…. I must say there are terrific looking gals shopping there. It was fun looking around. I might do it again sometime.”

    You can always strike up a conversation with a terrific looking blond etc. by looking helpless when asking her if she knows where the toothpaste is. She’s invariably helpful if you put on the helpless pup expression. A conversation may ensure.

    Outside the store that gal wouldn’t spit on me.

    This approach was used yesterday at Office Works when I was genuinely helpless while looking at fax machines. A gal turned up offering to give me her research on 6 faxes. She was a great looker and kind person.

    This is the sort of thing that makes a shopping experience enjoyable for everyone. If the big chains could work with this I am sure more guys would enjoy the experience of shopping cheap or expensive generics.

  23. 23 JCNo Gravatar

    Trot

    The meant arrives cooked on the dinner plate. Knowing my wife and the fussy attitude she has with milk brand names I would guess it comes from a butcher.

    I help with dishes. Ok!

  24. 24 RonNo Gravatar

    “You can always strike up a conversation with a terrific looking blond”

    I somehow end up Coles on pensioner days when the old blokes are there. Discussing our prostate problems and the best type of Depends does nothing for me.

  25. 25 RonNo Gravatar

    “Lining up at the meat market”

    Actually, despite my comment above, you can meet some really nice numbers at the vegan/vegetarian section.

    There’s not much that is sexier than a discussion about the merits of firm or silky tofu.

  26. 26 NabakovNo Gravatar

    “The secret of marriage is that one is never forced to do the mundane stuff if it can be negotiated and avoided. ”

    Though the secret seems in your case to be spending a lot of time online venting all your pent up aggression on people you’ve never met while waiting for food to magically appear.

    Hope the wife has her own broadband connection. Imagine emerging flushed and drained from another “session” in your study to find her watching “Desperate Housewives” with another empty bottle of sav blanc on the coffee table, next to the full ashtray.

  27. 27 F. David BowerNo Gravatar

    Lordy me, here I was thinking I’d been a bit hard on you, JC. Sorry about putting words in your mouth. It did seem like an only slightly over-the-top version of your argument to me, but you’d know best. Believe me, it pained me to write it - sarcasm notwithstanding, regurgitating retail advertising copy is (for me at least) irksome.

    Apologies aside, is anything you’ve said for real, or are you just baiting? I’m prepared to think that of your sexism and your mindless defence of corporate governance in the face of a mountain of evidence and plain logic.

    But is it really your thesis that any old bunch of well-intentioned lefty bloggers could draw up a business plan and seriously take on the big chains? Do you have brain-moronism in its late stages?

    These companies are exercising monopoly power over what is and isn’t available to consumers. This is ACTUALLY HAPPENING, JC. And they are doing it to make money because that is the beginning and end of their job as a company. You don’t HAVE to believe it, but don’t just deny it out of hand because it doesn’t tally with your views.

  28. 28 JCNo Gravatar

    Rons says:
    I somehow end up Coles on pensioner days when the old blokes are there. Discussing our prostate problems

    Stay away from those types Ron. They just bring you down to their level and ruin your chances.

    If one of these codgers asks, “how is the prostate going”, always answer loudly with, “i never had a problem in that department, never”. Then walk rudely away making sure that if the oppostie number hears her interest may be aroused by the fact that you aren’t the sickly creature you first appeared.

    Stick around the meat section more often. It has more of a masculine tone to it. Don’t buy shampoo as it’s not manly and could send the wrong signal to the blond behind you.

    These are tips RH would agree with, I’m sure.

  29. 29 JCNo Gravatar

    F. David

    The sexsim, as you nicely put it is a joke. The rest has a good ring of truth to it- not about meeitign blondes and such.

    There are little barriers to entry for a large overseas chain to set up here. The brand names would love it.

    Let me tell you how I see It. I have lived in both Melb and Syd. Syd supermarkets are the pits. Everyone of them, or at least most.

    The German chain set up here as they saw an opening. I wouldn’t be surprsied to see others follow. If these guys are pissing people off they will eventually readjust or go out of business. Markets take tiome to correct and they aren’t perfect. However monopolies cannot exist outside of the framework of government fiat. Fact.

  30. 30 JCNo Gravatar

    Nabs

    She’s away for a few weeks. back to the old town visiting friends. I hope!!! Otherwise I guess I’ll be seeing you at the checkout more often. That’s me with the forlorn unhappy look.

    Nothing to do with markets at the moment. Haven’t done a thing for several months until June when the new year rolls round.

  31. 31 MarkNo Gravatar

    There’s not much that is sexier than a discussion about the merits of firm or silky tofu.

    I respectfully beg to differ, Ron. Try a conversation about the merits of yellow vs. red chillis.

  32. 32 JahTehNo Gravatar

    A supermarket thread and not one woman commenting. We have conquered the men at last.

  33. 33 RonNo Gravatar

    ““how is the prostate goingâ€?, always answer loudly with” …

    ‘I haven’t got one anymore’. That always shuts them up!

  34. 34 NabakovNo Gravatar

    That’s quite a picture you’re painting there joe. Hanging round the meat section, loudly annoucing your prostate’s just fine thank you while barging up to blondes explaing it’s the toothpaste not the shampoo you need help with.

    When can we expect the book? ” Super Meet Market: Finding wool at Woolworths and how get your coals hauled at Coles.” Will the deluxe package come with personalised phone interviews a la the master.

  35. 35 RonNo Gravatar

    “yellow vs. red chillis”

    I’ve tried that a few times but it always seem to get around to length, firmness and girth. And, of course, iwhen I get home that I slap my head three times saying stupid, stupid, stupid (’cause it takes me all that time to realise where the conversation was heading)!

  36. 36 JahTehNo Gravatar

    I couldn’t resist that.

    I was told at Safeway that they were reducing the products because people didn’t have time to waste over selecting brands….and I have a bridge in Sydney I want to sell.

    The German company’s products are geared to carnivores and the local one I have been to was not impressive.

    Generic brands are generally rubbish.

    Both Coles and Safeway/Woolworths put up the prices when they feel like it.
    Except for cat food, that went up because the price of steel they make the cans out of went up.

    I am the person who drops things on the floor and kicks them through to the other side of the shelf for the minions to pick up. Sue me!

  37. 37 NabakovNo Gravatar

    “I guess I’ll be seeing you at the checkout more often”

    Nah, when it comes to poontang, I work first nights, private viewings, weddings, funerals, christenings and four star plus hotel lobbies.

  38. 38 JahTehNo Gravatar

    In other words, Nabakov, desperate and dateless.

  39. 39 RonNo Gravatar

    “desperate and dateless”

    I wonder if that describes most bloggers/commenters? ;-)

  40. 40 NabakovNo Gravatar

    “In other words, Nabakov, desperate and dateless.”

    Oh, pfaff! I’ve already had sex in the 21st century. Twice! Well OK, one and a half times and almost with different people. Can you boast the same?

  41. 41 JahTehNo Gravatar

    I am totally committed to gaining my certificate as a born-again virgin.

  42. 42 RonNo Gravatar
  43. 43 KieranNo Gravatar

    pleased to meat you, hope you guessed my name

  44. 44 JahTehNo Gravatar

    No surgery, aversion therapy.

    I worry about you Ron, you go to some diabolical sites.

  45. 45 RonNo Gravatar

    I was wondering how we got from monopoly to hymenoplasty when I realised there is a tenuous connection.

  46. 46 NabakovNo Gravatar

    “a tenuous connection”

    Stretched to busting point by now, I’d say.

  47. 47 F. David BowerNo Gravatar

    ““desperate and datelessâ€?

    I wonder if that describes most bloggers/commenters? ;-)”

    I protest(eth too much).

  48. 48 RazorNo Gravatar

    JC,

    You are wasting your breath. These plonkers think that investors shouldn’t be allowed to make profits from making reasonable business decisions. The supermarket chains unlock the value of their shelf space - Oh the humanity!!

    They also appear to think they have some ‘rights’ to be supplied with whatever they want.

    There is no monopoly situation in most of Australian retail. If you don’t like the choices available or can’t find what you want then go somewhere else. There are heaps of alternatives - smaller grocery chains, on-line, direct from growers/manufacturers, boutique shops (do Asian/Continental stores fit in this.)etc etc.

    If there is so little choice - why are the stores so bloody big?

    And I’m with you on the talent potential. I find taking my 10 month old daughter works wonderfully to pull the chicks. Unfortunately 80% are the same age as her grandmothers, but the 20% is worth it.

    A complete load of tosh!

  49. 49 MarkNo Gravatar

    Shorter Razor: stuff the theory of consumer sovereignty which can’t be defended in practice, it’s all about money for big business and investors.

  50. 50 MarkNo Gravatar

    There are heaps of alternatives - smaller grocery chains, on-line, direct from growers/manufacturers, boutique shops (do Asian/Continental stores fit in this.)etc etc.

    Presuming you can afford to go elsewhere.

  51. 51 JCNo Gravatar

    So what’s your solution, Mark. How would you go about creating thr perfect grocery chain.

    Thi sisn’t a trick question as I would be real interested. The only thing I’ve hard is a lot of moaning. So let’s here it from all of you.

  52. 52 PaulusNo Gravatar

    Sigh, JC, monopolies can arise through economies of scale. Read wiki, you might learn something …
    http://en.wikipedia.org/wiki/Monopoly

    Tell me, where did you do your PhD? I’m guessing it must have been Chicago or the LSE.

    Yes, theoretically, all non-government monopolies may disappear *eventually*. If you give the water supply to a private company, heck, maybe in a century or two someone will find a way to teleport water from the Antarctic straight into your home …

    To the other posters: what exactly do you guys miss at the supermarket? Name some particular items — I’m just curious.

  53. 53 steve munnNo Gravatar

    The big Australian supermarkets are following the lead of their American counterparts in that they have a deliberate policy of reducing choice by ramping up the supply and demand for their home brands.

    I recall reading an article about this policy a couple of years ago in “The Age”. My brother-in-law, who is a 2IC in a Coles store, later confirmed it for me. Joe’s little story about consumer sovereignty is unbelievably naive.

    I shop at the local Northcote Plaza where I have a “choice” between Coles and Bi-Lo, both of which are Coles-Myer companies. I make this choice NOT because of wonderful customer service and a superior product range but because it saves an enormous amount of time compared to strip shopping and the next Shopping Plaza is a half hour drive away.

    The fruit and veg at my local Coles and Bi-Lo are overpriced and rarely fresh, yet I still usually buy them because of the time factor. Razor’s “you can always go someplace else” doesn’t stand up to scrutiny. No-one has the time, patience, inclination or even the skill to make objective rational item-by-item product assessments of every available option.

    When I enter the local Shopping Plaza I feel more like a fly entering a spider’s web than the mythical sovereign consumer.

  54. 54 anthonyNo Gravatar

    Supermarkets are great

    if you’re an eight year old.

    A whole aisle of chippies! Wooooooooh!

    Apologies to the delicate sensibilities of private enterprise panglossians.

  55. 55 csNo Gravatar

    and a half times

    Hey, Nabs ol’ chap, someone can’t let that pass. “half times”? Is that like at the footie?

  56. 56 AustinNo Gravatar

    This comment on “satisfying the consumer. If they don’t they go bust. Fact.” is not a fact. This statement uses the singular consumer. It is more about numbers. They require the majority to be happy to have the required numbers in the account books. Anyone with particular needs who are in the minority are poorly accounted for and are not satisfied (i.e. vegan and other dietary requirements).

  57. 57 csNo Gravatar

    Don’t forget the ever growing practice of redlighting “bad” customers, read every form of vertical discrimination in the book, and what the book doesn’t yet know about.

  58. 58 Steve MunnNo Gravatar

    Austin says: “They require the majority to be happy to have the required numbers in the account books.”

    Nope. As long as the shopper has no convenient alternative to the big chains, all the oligopolists need do is ensure we are not sufficiently dissatisfied to do anything radical, like develop blisters and waste petrol by shopping at smaller stores.

    Let’s also not forget that the oligopolists (I love that word) can use dirty tricks to strangle any little guy who looks like stealing some of their business. For example if the local greengrocer is doing too well the big chains will undercut the greengrocer’s prices- even if that means selling below cost- and force him out of business. Afterwards the big chain can jack prices up without fear of competition.

    The real world of business has little to do with the sweet homilies of JC and Razor.

  59. 59 Gummo TrotskyNo Gravatar

    What do I miss at the local supermarket? In a word - spices. Last time I was at one of those Coles/Woolies megamarts, that section was full of these dinky “Spice LIbraries” e.g. for sweet spices, cardamom and two others, in quantities too small to be of any bloody use whatsoever.

    And don’t get me started on the evil shit they sell as home brand cooking chocolate. I think it’s some evil blend of cocoa powder and beef dripping, or something equally vile.

  60. 60 Graham BellNo Gravatar

    Hands up all those who have seen the old movies “Rollerball” and “Soylent Green” or who know a bit about the workings of the Khmer Rouge regime.

    You are not going to have too much trouble out of a people whose food supply is rigidly controlled, are you?

    Conspiracy theorists who would be a long way wide of the mark if they claim that H5N1 Bird flu is a secret plot to deprive the common folk everywhere of their poultry, a cheap, readily-available source of protein ….. but loss of such an important family-owned food source could possibly be to the advantage of someone or some group seeking absolute power.

  61. 61 F. David BowerNo Gravatar

    Two things trouble me.

    Firstly re: generics, I’m not that freaked out for myself. I’m not a primary producer or a small food processing company, so for me it’s just about range and quality, both of which can theoretically come from generics. Less competition=less requirement to keep quality up, but we’ve always had crappy foods. I can remember ‘compounded’ chocolate from way back before Black and Gold. It has zero cocoa liquor (made up for with vegetable fats) very little cocoa mass either (sometimes made up for with brown food dye) and usually with lumps of undissolved sugar in it. It sucks, but it’s nothing new.

    Second, and for me personally more serious, is the rampant overcharging for “specialty” items that accompanies (i.e. offsets) the cheaper generics. This also occurs with the upper tiers of generics, where an item is assumed to be (and probably is) of higher quality because it costs more. JC, I too pity you if you think the supermarket is the place for meat. Even in our superior Vic supermarkets, the difference is generally in the order of 50% cheaper at the market (Vic, Footscray or Preston - I haven’t tried those fruity southern ones). Don’t let’s even discuss the quality, I could go on for hours. Chillies - $20 per kilo (last I looked, they’re unbelievably easy to grow and demand is high and rising). Ginger - $25 pk. Rice stick, udon, coconut milk, anything required for basic asian cooking - about double the price as at an Asian store.

    Ok, guilty as charged. I live in North Fitzroy, where the nearest supermarkets are literally surrounded by vastly superior smaller stores. I only need Safeway or Coles for household supplies and cat food. I just wish more people could have that, rather than great tracts of suburbia dominated by a vast squatting toad of a supermarket.

    Also, someone made a comment a while back about General Motors. I believe the context was in showing how monopolies collapse without government complicity. It is also interesting to note how they achieved their monopoly, though. I forget the figures, but the number of car manufacturers forced out of business by the growing power of GM and Chrysler in the early 20th century is staggering, and the resulting decline in manufacturing standards and choice for the consumer is a matter of historical record. Interesting. Maybe, just maybe they shouldn’t have been allowed to do that.

  62. 62 CristyNo Gravatar

    A friend of mine used to work as a packer in a busy Woolworths in Melbourne. While he was there several products were discontinued. All of these were very popular products and so he asked someone in management why they had been discontinued. He was informed (to my ongoing shock) that these particular products were too popular and cost too much to continually restock. He asked if this might lose Woolworths money and the manager person laughed and informed him that customers would simply buy the other (previously less popular) brands available, because it was not as though they would go elsewhere just for that particular brand preference.

    I go to the local farmer’s market to buy locally grown fruit and vegies, and try to get the rest of my food at the food co-op or speciality stores like the asian grocer or the deli.

    I hate the supermarket. Very few products at the supermarket are organic or locally produced, very few imported products are fair trade, and most are covered in useless packaging that just goes straight to landfill. To add insult to injury, their products are generally more expensive than those at the markets or food co-op.

  63. 63 Francis Xavier HoldenNo Gravatar

    I have no problem with generics. In most cases they are the same as other products without the fancy packaging and adverts. Generally no one sets up a seperate production line to produce inferior products. Bread is a good example - it will be the same bread that goes into a brand package except its in a plain wrapper.

    Gummo - you sure were wearing glasses and didn’t buy the Gravox instead?

    Bi-Lo always has the really cheapest meat and mostly better quality than the big supas. The local asian market is usually best for vegies and spices and tinned stuff. Fish varies like buggery in price and quality.

    You think supa markets are bad - try the local organic shop if you want to experience sticker shock.

    What I really meant to write about was lemons. I’m waiting for Nic Gruen to do a column on lemons. It always amazes me - if you know someone with a good lemon tree you can get bag fulls of them free, yet you pay up to 30c - 40c ea. at a supa mart or fruit shop. I’ve never been able to grow a bloody decent lemon tree. And one of my neighbours who had a bountiful one had the husband out of the blue hack it down with a chainsaw one day. I don’t know who was madder with him, her or me.

  64. 64 RonNo Gravatar

    FXH,

    “Bi-Lo always has the really cheapest meat and mostly better quality than the big supas”

    Do you know that Bi-Lo is owned by Coles?

    I object to 70c for a choko!

  65. 65 RonNo Gravatar

    “what exactly do you guys miss at the supermarket?”

    What motivated me for the post yesterday was the loss of Rose’s Old English Marmalade. This is made by Cottee’s and it was the Cottee’s customer desk that told me Coles won’t stock it any longer.

  66. 66 Francis Xavier HoldenNo Gravatar

    yes

  67. 67 via collinsNo Gravatar

    FXH,

    I feel your lemony pain.

    Most of my life I hankered after the perfect lemon tree. So first house, there she was, hundreds of sweet lemon blossoms in full bloom when we moved in. All I had to do was spend summer under her branches, and rack up lemons - cordial, cocktail accompaniments, lemon delicious puddings, life was as it should be.

    Soon enough, a wise gardening soul looked deeply into the heart of my lemon tree, shook her head sadly, and mumbled “gall wasp - it’s rooted mate”. That was a new chapter in my life - first awareness of the almost invisible demons that will drill the lemon tree out from within. And so it came, a tree surgeon came, stripped the tree back to…well, not much. He pronounced her very unlikely to pull through, but we’re happy to gamble for lemons. Years passed, years full of outrageous prices for not always good lemons, but lo, the lemon tree grew, and grew, and as her first fruits of new life were poised….the wife sold the house.

    Another house, this time an even bigger lemon tree. It’s what we deserved, it’s tall, it’s shady, it’s abundant with fruit, it’s…..riddled with gall wasp. Well, it was, it’s gone now, and as I write, the new garden is growing, and my third go at lemons every day is underway.

    And in the meantime, I now get to wander into the odd backyward, push the branches aside and mumble, “gall wasp - she’s rooted mate.

  68. 68 Steve MunnNo Gravatar

    Speaking of lemons the CSIRO has developed three native citrus cultivars that are a bit like lemons. The fruits also look really cool and come in green, orange and purple. I think I might buy one of each for my dear old mum’s native garden. See http://www.csiro.au/files/mediaRelease/mr2001/Prlimes.htm

    Fortunately I live in a predominately Greek suburb and can therefore pluck a lemon or two from one of the many lemon trees that overhang the footpaths and alleys.

  69. 69 The Devil DrinkNo Gravatar

    Mid-twentieth century folklore had it that the best backyard lemon trees were the ones planted on the graves of deceased domestic animals: mass migration, of course, expanded the folklore so that it could also apply to olive trees.
    If you ask the owners about a lot of good lemon or olive trees it’s a good bet they’ll also cite the location as the grave of a 20-year dead dog or cat.
    A bit of lemon rind is a perfectly acceptable olive replacement in martinis, when those aren’t available. That’s justification right there for the existence of lemons, not to mention olives.
    Three thirty’s coming up. Stuff work. To the fridge!

  70. 70 J F BeckNo Gravatar

    Ron,

    Just so I’ve got this right, you’re saying Rose’s Old English Marmalade is no longer manufactured because Coles refuses to stock it?

  71. 71 PaulusNo Gravatar

    Devil Drink,

    You’ve got me thinking … suppose I buy a bit of land and set up a lemon orchard … but before I put the trees in, I scour the neighbourhood for trusting dogs and cats that will let me approach them … then I off ‘em and bury one beneath each tree!

    I’ll make my fortune with Lucky Pet Lemons!!!

    (The image on the bag will show a smiling cat and dog nestled at the foot of a lemon tree.)

  72. 72 The Devil DrinkNo Gravatar

    Well, Paulus, maybe.
    Think of the practicalities though. Citrus trees take many many years to grow, and many small harvests of fruit before any good harvests, I think your neighbours whose pets you’d have killed would have had quite enough time to figure you out—and beat the crap out of you.
    Besides which, that’s a horrible idea. Shame on you.
    Your penance is to visit this site.

  73. 73 JahTehNo Gravatar

    As the proud owner of lemon, lime, orange, grapefruit and mandarin trees, I can tell you no pets were harmed in the growing.

    Total indifference to their wellbeing except for vicious pruning seems to work for me, that and trusting the heavens for water.

  74. 74 PaulusNo Gravatar

    Devil Drink,

    You’re getting emotional. I know you’ve been upset by the disappearance of Muffy, but you must try to relax … here, have a glass of my nice home-made lemonade … you know, I’ll bet Muffy’s really much closer than you think! :)

  75. 75 BismarckNo Gravatar

    I fear that Cristy’s story about the deletion of overly popular brands at Woolies has the aroma of urban mythology about it. For one thing, it seems to be an updated version of an old saw about discontinuing the supply of pantyhose in Soviet Russia (because they kept selling out). For another, huh? If there’s one thing Woolworths understands it’s the bottom line. Restocking costs are minimal and often borne by the supplier. If it’s that much of a problem, just put the price up. Or are they scared of losing customers to Coles?

    BTW, ‘organic’ produce is the biggest scam going. I don’t get enough of a warm inner glow to compensate for the whopping premiums on substandard produce.

  76. 76 rogNo Gravatar

    Rose’s Old English Marmalade deserves to be dumped from the shelves, not a patch on Lackersteen

  77. 77 JoeNo Gravatar

    where can I buy lackersteen marmalade in Sydney suburbs . It seems to have disappeared from the shelves in Wollies/IGA etc

  78. 78 JoeNo Gravatar

    Rog
    Where can I buy Lackersteen Marmalade in Sydney Suburbs. (Bankstown Area)

    Have disappeared from shelves in Wollies/IGA etc

  79. 79 Mark HillNo Gravatar

    How about consistency guys?

    NO choice? I swear last month your mates Clive and Pria were deriding the “insane” level of choice we had.

    Socialist economic theory:

    All businesses become monopolies. All monopolies provide homogeneous products. All monopolies are bad. There are no transaction costs or internalisation benefits of monopolies. Except the Government which enjoys fantastic economies of scale.

  80. 80 FDBNo Gravatar

    Mark Hill rhetorical technique:

    Construct strawman.

    Apply flame.

    Sit back and marvel at own genius.

  81. 81 Mark HillNo Gravatar

    True, I beat it down, but I never built it.

    Will “the left” decide if business gives you too much or too little choice?

    Are you sure the anti-monopolist story has not been brought out here? People say you can raise a monopoly by economies of scale - sure, but there are also capital markets and international investors. There is also diversification and firm growth. But then we have the “solution” to these monopolies being formed by entrenching incumbent monopolies or oligopolies. What was this policy trying to achieve?

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