I’m told that Coles is not passing on freight costs imposed by News Corp. for flying its print products into Port Lincoln. In doing so, Coles is selling The Advertiser at a significant discount to newsagents who are passing on the freight cost.
What Coles is doing sounds like it could be predatory pricing as defined by the ACCC. Funding for the freight must be coming from other parts of the business as they would not make enough from newspapers themselves to cover this.
My question is: is Coles doing this to damage the small business newsagencies with which they compete? Such an allegation would be hard to prove. That said, harm to the newsagents and benefit for Coles are the only outcomes I can see from the Coles action.
I have contacted Coles about this ion behalf of the newsagent who brought it to my attention and so far have received no response.
Mark, I think Coles and Woolworths have national or state based pricing guidelines. This is due to in the past richer suburbs like Toorak might be charged higher prices than poorer places like Dandenong, which was controversial. It might be worth checking if this pricing difference is also the case in other locations that incur freight charges for the paper.
Dean this is a matter of Coles charging a lower price for the paper compared to every other retailer in town. They are absorbing a hefty freight charge in doing this.
I had a issue with freight that I was not aware of for quite sometime. It only came to light when I forgot to take a Sat paper home and found that IGA was selling theirs at cover price and were selling ours for .60 more. As our Sat papers come on IGA truck not freight was being charged to News Limited had been charging us freight and I had been charging IGA freight. They had been selling at a loss! We have not have now had the freight removed and are both on the same footing. Maybe Coles are being charged freight and don’t realise?
Heck I wish I could go back and edit my typo mistakes!
My understanding of the situation is that Coles is aware.
Mark, I think you missed my point. I suspect that it is Coles policy that everyone in South Australia pays the same price for every product. It doesn’t matter if it is cheese or milk or the paper. While newsagents may think this is unfair in situations like this where the newsagent charges customers the freight and Coles doesn’t, from Coles perspective there was a major outcry, and maybe even a ACCC investigation, about 10 years ago into differential pricing by store, and since then it has been Coles policy that all consumers regardless of which store they shop at will be charged the same price.
Dean, you still pay more for bread, tinned tomatoes, pasta etc.. in Toorak (sub with your states premium burb) than you do in Broadmeadows…..
This may simply be about their adherence to the scanning code of practice. Rather than some other reason.
http://www.anra.com.au/Scanning%20Code%20of%20Practice%20for%20Supermarkets/ScanningCode
This dictates that the item must be given away for free if it differs from the price marked.
They can remark the price to match the real price of the product – as everyone else does.