Australia has been conducting an in-depth study into supermarket sector since the beginning of 2024, helmed by the Australian Competitor and Consumer Commission (ACCC).
After over a year of inquiries, the commission recently published its final report in March 2025, concluding that the current structure of the local retail sector is essentially an oligopoly led by Woolworths and Coles.
This is very similar to the situation faced by neighbouring market New Zealand previously, which has seen shifts towards a reform of sorts in recent years led by the New Zealand Food and Grocery Council (NZFGC).
In Australia, due to the larger size of this market, co-ops are much more abundant and widespread, and the local co-op sector believes that the market needs to increase its focus on smaller retail outlets such as these in order to break the local oligopoly - and that this will require government support.
“We herald the major first recommendation of the ACCC inquiry into supermarket power for government to support more co-operative supermarkets, [so as to] support better prices and competition for Australian shoppers especially in regional and remote areas,” said local Business Council of Co-operatives and Mutuals (BCCM) CEO Melina Morrison.
“[ACCC’s conclusions show that] Australian consumers suffer when it comes to their shopping bill on food and groceries because of the clear oligopoly in the supermarket sector.
“In regional areas, co-ops play a vital role in thinner or less profitable markets - they are also motivated to keep prices lower, increase choice on the shelf and treat suppliers ethically.”
Business sense
She also stressed that on the international front, it can be seen that co-ops and other small retail stores require government policy support in order to really make a difference in the market they are in, and this is unlikely to be any different in Australia.
“In many countries the secret to the flourishing of independent stores, co-op supermarkets and farmers’ markets is the fact that business policy settings enable these types of businesses to compete on a level playing field,” she said.
“In markets without this support, the slow attrition of mum and dad stores, smaller supermarkets, independent stores and co-ops is also the result of policies failing to support these different corporate structures.
“As such, policies encouraging co-operatives to form and grow in retail must be part of a multi-pronged strategy to counter monopolisation of markets.
“[It also makes very sustainable business sense as] particularly in the regional, non-urban areas, co-ops are an excellent choice for retail, holding investment in the community, employing locally and facilitating shorter and more localised supply chains.
“This means the communities served by retail co-ops are better served in times of crisis when decisions are made close to home.”
The ACCC report also highlighted that independent retail stores in Australia perform a ‘particularly vital function in outer regional and remote Australia, where [large supermarkets] are not present or have only a limited presence’, but that this is generally non-price competition as these stores tend to ‘generally price higher’ than the larger supermarkets due to various constraints.