ACCC final report and recommendations

21 March 2025

The ACCC has released the final report from its supermarket inquiry following a year-long investigation into the sector. The competition regulator has found that Coles and Woolworths “dominate” the “highly concentrated” sector, with major implications for suppliers and consumers. 

Noting the significant rise in grocery shelf prices over the last five years, the ACCC concludes that most of these increases are due to escalating costs of doing business, particularly for suppliers. However, “ALDI, Coles and Woolworths have increased their product and EBIT margins during this time, meaning that at least some of the grocery price increases have resulted in additional profits for ALDI, Coles and Woolworths”. 

The ACCC also highlights the impact of retail market concentration on supply chains, noting that Coles and Woolworths are in the position to use their bargaining power to “obtain lower wholesale prices. In an inflationary environment, this often takes the form of resisting wholesale price increases in whole or part”. 

Overall, the report concludes: 

Coles and Woolworths’ dominance of the sector seems set to continue. While they face ongoing and evolving competitive challenges on many fronts, their entrenched position in an oligopolistic market means substantial pro-competitive departures from the status quo are unlikely in the foreseeable future. 

The report provides 20 recommendations for the sector. Although many are focused on addressing consumer concerns and the particular challenges faced by fresh suppliers, there are nevertheless several with implications for suppliers of packaged goods, reproduced below (the full list of recommendations can be found at the bottom of this brief). These are described as measures to “equip suppliers with information that will allow them to make better informed production decisions and limit supermarkets’ ability to push their operating risks onto suppliers”. 

The Government has the ultimate authority to accept or reject the recommendations within the report. The AFGC will continue to liaise with the Minister’s office, providing further updates as they come to hand.  

Shrinkflation 

Recommendation 6 – Supermarkets should be required to publish notifications when package size changes occur in a manner adverse to consumers. 

This information would, at a minimum, be required to be published in proximity to the product ticket on shelves, and on website product pages. It would also need to be published for a sufficient period to enable consumers to become aware of the unit price change 

Food and Grocery Code of Conduct 

Recommendation 10 – Supermarkets should not be able to negotiate out of key minimum protections in the Food and Grocery Code. 

ACCC recommend that the Food and Grocery Code should be amended to prohibit grocery retailers from being able to negotiate out of the core protections of the Code. The Code should be amended to remove all current exemptions. No exemptions should be allowed from the core protections in the Code. 

Harmonisation of requirements 

Recommendation 11 – Harmonisation of accreditation and auditing requirements. 

ALDI, Coles, Metcash and Woolworths should consider ways to harmonise minimum supplier accreditation and auditing requirements. 

Rebate transparency 

Recommendation 19 – There should be greater transparency about the rebates suppliers pay to supermarkets. 

If requested by the supplier to do so, large supermarkets and wholesalers should provide suppliers with an itemised account of all payments and deductions off invoices at the end of each financial year. This should also include a description of the payment or deduction including the reason or the purpose for each, and how the amount is calculated. 

Retail media 

Recommendation 20 – Coles and Woolworths should be more transparent about how supplier funding contributions to their inhouse retail media services are used. 

Specifically, Coles and Woolworths must provide each supplier that has provided funding to Coles 360 or Woolworths Cartology with an itemised account of how the money contributed was used if the supplier requests this information. If supplier funding was used for any purpose other than promoting a specific brand or brands of the supplier (for example, to promote a homogenous fresh produce product category), the amount of funding contributed by other suppliers to each promotion must be provided (in aggregate as a single figure). 

Next steps 

The AFGC will review the 441 page report and provide a more substantive member brief along with a member-only webinar next week.  

In the meantime, for further information please contact Samantha Blake (samantha.blake@afgc.org.au), Rick Umback (rick.umback@afgc.org.au) or Colm Maguire (colm.maguire@afgc.org.au).  

 
COLM MAGUIRE  
CHIEF EXECUTIVE OFFICER