Retail in Asia

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Australian suppliers prefer Aldi to Coles, Woolworths

A number of suppliers producing a range of groceries have spoken out against the dominant Australian supermarket chains, Woolworths and Coles, saying they prefer dealing with German-owned rival Aldi.

BusinessDay has revealed Woolworths produced a dossier that claims Aldi’s arrival in Australia has led to a rise in private label products and a tough competitive environment.

Several suppliers have spoken out about their experience supplying Australian supermarkets on the condition of anonymity, fearing contracts would be cancelled in retribution. They say they prefer dealing with Aldi because it pays invoices faster and is easier to deal with. One said it was ”so much better and much more stable to do business with”. Another said Coles and Woolworths reduced supplier prices and took an extra 3 percent to cover marketing costs when products go on sale, where Aldi would absorb the losses sales into its own profit margin.