Sunday, August 10, 2008

FuelWatch and GroceryChoice

FuelWatch continues to be mauled during the Senate Committee process.

Today on Meet The Press, the Consumer Minister Chris Bowen found a great way of selling it.

Here's what he said:

"What is FuelWatch?

When the Government puts out a tender, when the Government wants to buy something which is expensive, it says to people who want to sell it to them, "Put in a price, put in your best price, and then we'll judge it, and you can't reduce that price because we want your best price up front."

This is giving motorists a chance to call for a tender for their petrol and really, the conservatives in the Senate should get out of the way and let motorists have that opportunity."

GROCERYchoice is actually rather good.

Critics have been saying it tells you nothing more than that ALDI is cheap, and that the IGA/Independents are expensive. The Australian has even argued that the website is an advertisement for ALDI.

(Try it for yourself, typing in your own postcode.)

But that's beside the point. The facts are that ALDI is very cheap and that this information is useful.

About the report of the ACCC Grocery Price Inquiry...

Commenter Tick Tock writes:

"A non-event of massive proportions. Unit pricing + zoning laws + Horticulture regs. Yawn. The report pretty much vindicates the supermarkets, as does the Government's response."

But I think this too misses the point.

The ACCC did a very thorough job and did indeed discover that not much is wrong in the supermarket industry (apart from the role of Metcash). This is an important finding. A surprising one to many, but important one.

We shouldn't dismiss the worth of its inquiry just because it has shot down some interesting theories - that's as important as finding those theories correct.

By the way, here's an interesting graph from the report of the Grocery Prices Inquiry: (click to enlarge)

Our own Woolworths turns out to be very, very profitable.


WT said...

I took your advice and tried the Grocerywatch site, it tells me that the cheapest in my area is a chain who's closest store is over an hour away. Yep, seems to work just fine.

Tick Tock said...

Peter, anyone paying attention knew that Woolworths and Coles had been cutting each others' throats for years, and that Aldi brought renewed vigour to the competitive landscape This was a political inquiry with a political objective. Rudd apparently didn't count on the competence and/or honesty of ACCC staff (or did he - I'll leave that one for the cynics). The ACCC merely confirmed what the market already knew. And all just so that Rudd could go to the public pre-election with some vague, amorphous "I feel your grocery pain" non-promise. Brilliant politics, but ethically and morally bankrupt.

Tick Tock

Vee said...

I tried putting my postcode into grocery choice as soon as it was available and you know what happened?

Absolutely nothing.

So I changed from firefox to IE and did it again.

Absolutely nothing happened.

So I surfed my way through the basket of goods which told me coles and woollies, the prices were about the same, the difference was marginal.

Then it told me the Independents were cheaper with that basket of goods (whatever those goods may be).

Then ALDIs cheaper again.

Short version: the site doesn't work.

Tick Tick said...

What's truly absurd about this is that if the site works as intended (which it doesn't, apparently), it is still not helpful. It gives broad brushstroke information whereas the (alleged) audience has extensive lived experience on the specifics. Only a career bureaucrat like Kevin Rudd could possibly come up with an inquiry and informational website that merely sets out, at a uselessly high level, what every household shopper, and every market participant, already knew. The only people to whom these results come as anything of a shock are solidly upper-middle class types for whom real household budgeting is a mystery and for whom the weekly grocery shop is not a significant portion of their living costs.

Tick Tock

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