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Government should be able to increase competition in supermarket in Australia

Comments on Font Michael Costa “Not so super markets”, 3/07/2009, http://www.theaustralian.news.com.au/story/0,25197,25724260-5013480,00.html

Costa discussed an important issue for a more competitive supermarket in Australia, that is, the physical environment for potential competitors to contest with the existing majors. Planning processes and practices may be a factor and that should be addressed by government.

Comments by Sven Lotzvie of Brisbane are also insightful. Australia does suffer from small sizes in the world of globalisation. Government restrictions on international entry and competition are unhelpful to a more competitive market. Those restrictions need to be removed.

There is also an issue of unfair discrimination due to the lack of competition that also needs to be addressed. This unfair discrimination is the practice by a super marketer to charge the same item with different prices at different locations with no differences in cost factors.

Competition watchdog should be able to address this issue. Of course, this requires the competition watchdog to work efficiently and smartly as possible. It needs to be more diligent itself.

By addressing this issue appropriately, the adverse effects of past planning legacy on competition can be minimised. It also lessens the needs for every super market location to have available space for competitors.

The federal government thus has several tasks to do to increase the competition of super markets in Australia. They should not be too difficult.

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