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Metcash plays down threat of expanding Aldi in south and west Australia

Metcash chief executive Ian Morrice says investors are over-simplifying the problems facing the company in South Australia and Western Australia when German discounter Aldi starts in 2016, by automatically assuming the eastern states’ experience will be repeated.

Mr Morrice said some of the best supermarkets in the nation were trading under the IGA and Foodland banner supplied by Metcash in those states, and they were primed and ready to do battle on price, convenience and quality, and were better-positioned than independent stores were in Victoria and NSW for the entry of Aldi with its low-cost model.

"In essence, the argument to me has been somewhat over-simplified," Mr Morrice said on Tuesday after a full-day investor briefing outlining the Metcash strategy, which revolves heavily around becoming more competitive on prices under a Price Match program to try to shift perceptions that IGA stores are too expensive.