Wednesday, August 06, 2008

Calling a Duck a Duck

John Durie in the Australian on Kevin Rudd's benevolent monitoring of those pesky Aussie Uber Capitalists seeking to rip off working families, the Supermarkets, Fuel Companies and soon, the banks.

To give the Government its due, as much as FuelWatch and Grocery Choice are third-best choices, they do, at the margin, provide extra transparency and at last Grocery Choice doesn't inhibit competition as FuelWatch does. Next in line will be BankWatch to keep an eye on bank mortgages, then Carbon-trading Watch to see who is ripping off consumers by charging too much for carbon.

Those Captains of Industry must be quaking in their boots. The grocery chains seem to work on the principle of price matching, so expertly done by the fuel companies. The fuel companies all subscribe to one company that monitors prices around the country and immediately know what their competitors are doing. How can the government and consumers, compete against that? The supermarkets have armies of price checkers making sure that the competition is not eating into their market share.

Just over half of Aussie shoppers (including me) don't compare prices before going shopping. Can you imagine older people on a pension hopping on a web site to look at a generic basket of goods and work out that it is cheaper to shop at Coles this week. The basket will be very skewed by the typical shopping basket of families not living out their lives on tins of tuna and toast. Based on my own experience on any given week, most of the staples cost about the same and it would take very diligent shopping to save over 5 percent on a continuing basis by doing your homework.

Take tuna. Cans of tuna in Australia used to be very close to a dollar a can. Now they are closer to two dollars a can. That said, you can still reliably get tuna for about a dollar by using the specials. Yesterday, it was 7 for $7. You just have to do what you have to do to get the price you like.

Unit pricing, which is set to be introduced, makes a great deal of sense. Simple and useful for most consumers. Even granny can use that one. No abacus required.

Run Kevin! Duck for cover behind the transparent obfuscation of these "Hey Look, We Are Not Doing Something" Political Fixes. The season of talk in the Glorious Rudd Century is still in high gear.

Having looked at Grocery Watch, it is less useful than the Australian Government Public Toilet Location Site. At least you can get cheap peas there.

1 comment:

jmb said...

We've had unit pricing for years although it all goes to hell in a hand basket when something goes on special. Is the brand name on special cheaper than the housebrand at regular price? Seriously I don't think too many people actually use it and it probably will just add to the overall cost of the groceries since there will be no way that they will absorb the extra cost themselves.

Don't forget the sneaky price increases when they reduce the size of the package but charge the same price. I wonder how many people noticed for example that yogurt still in the same size container now only has 650 g instead of 750g.
However although prices are increasing food is still relatively cheap here, and I'm sure in Australia, in comparison with some places, for example Europe.