Grocery Choice set to launch on July 1, with or without grocers help

Posted by Daniel Palmer on 25th May 2009

Major grocery chains are resisting the request of Choice for over 3000 individual product prices from stores across their networks as the consumer group readies itself for a July 1 re-launch of the controversial site.

Choice has previously announced that consultancy firm SMS Management & Technology would help the consumer group with the $13 million task of rebuilding the troubled Grocery Choice website.

The site was first introduced last year after an ACCC Grocery Price Inquiry found the sector “workably competitive”. At first it was administered by the competition watchdog but it was soon clear that the site needed an overhaul if it was to offer any valuable advice to consumers.

Currently, the site, which has been taken over by Choice, focusses on 61 broad regions, with prices updated on a monthly basis. This has been criticised as irrelevant to the average consumer and, consequently, Choice is seeking to offer pricing information on a wide range of products from a few thousand supermarkets every week. However, supermarket chains – including Woolworths, Coles and IGA – are concerned about the cost of providing the information.

John Cummings, Chairman of the National Association of Retail Grocers of Australia – which represents independent grocers, has outlined concerns that the new site will prove too costly for the small chains. “Choice are getting $13 million from the Government to do it, so it is coming at no cost to them. Does the Government want to pay the independent sector $13 million for us to do it?” he asked last month.

Choice CEO, Nick Stace, is expected to send a letter to retailers today to advise the launch will be going ahead on July 1, whether they provide the information requested or not.

“I understand your cautionary approach given that we are about to enter unknown territory when transparent prices are made available to consumers at the touch of a button,” Mr Stace stated in a draft letter viewed by The Age. “Grocery Choice could and probably will transform the market for groceries and it would be strange if you didn’t have some fear that this could change your role in the market; albeit that you should see this as an opportunity.”