The Australian Competition and Consumer Commission (ACCC) has taken legal action against supermarket giants Coles and Woolworths, accusing them of misleading consumers through deceptive discount pricing practices on hundreds of commonly sold products.
Azzet contacted the companies, with both supplying official statements in response.
While Coles acknowledged cost-of-living pressures affecting households across Australia, the company intends to defend the proceedings, noting that it was “receiving a large number of cost price increases from our suppliers and, in addition, Coles’ own costs were rising, which led to an increase in the retail price of many products.”
Meanwhile, Woolworths Group CEO, Amanda Bardwell, said: “Cost-of-living pressures remain a key issue for millions of Australians who shop with us every week.“
The company will “carefully review the claims made by the ACCC and will continue to engage with the ACCC on the matter.”
The ACCC alleges that both retailers maintained stable long-term prices on various products, excluding short-term promotions, for periods ranging from six months to over a year.
During this time, these products experienced temporary price increases of at least 15%. They were later marketed under Woolworths’ “Prices Dropped” and Coles’ “Down Down” promotions at prices lower than the inflated rates but equal to or higher than their regular prices before the price hikes.
According to the regulator, Woolworths engaged in this practice for 266 products over 20 months, while Coles did so for 245 products across 15 months.
The ACCC has initiated separate proceedings in the Federal Court against both supermarket chains. ACCC Chair Gina Cass-Gottlieb expressed concern that consumers believe these promotional offers reflect genuine price reductions, stating, “In reality, the new promotional prices were often higher than, or the same as, the previous regular price.”
Cass-Gottlieb also noted that both Woolworths and Coles may have planned their promotions in advance, artificially inflating prices to create a higher "was" price for marketing purposes.
“We allege that each of Woolworths and Coles breached the Australian Consumer Law by making misleading claims about discounts, when the discounts were, in fact, illusory,” she said.