Publican cries foul over duopoly
CORONATION Hotel publican David McLean is sick of opening Woolworths and Coles catalogues and seeing alcohol on sale for less than he can buy it for.
Mr McLean is not opposed to competition. In fact, he welcomes it.
But in the past four years Coles and Woolworths have increased their market share in the liquor industry from 32% to 52%.
The Coronation Hotel is family-owned and operated.
Mr McLean said that while the sample size of locally owned hotels was very small, they were up against "insurmountable resources" concentrated in the hands of a duopoly.
Locally, Coles owns the Mi Hi Tavern and chains such as Liquorland, Vintage Cellars and 1st Choice. Woolworths owns the Racehorse Hotel, BWS and Dan Murphy's.
"The biggest problem we have is that there is a duopoly and they have got a stranglehold on the market. The amount of influence they have on the liquor industry is astounding," Mr McLean said.
"The likes of Dan Murphy's and BWS can sell liquor for cheaper than we can buy it.
"We are not allowed to advertise anything about on-premises specials. We couldn't tell anybody that we were charging X amount of dollars on Vodka Cruisers over the bar.
"But Woolworths and Coles can take a full-page ad and say that they are selling XXXX Gold for less than what we pay for it.
"We've got to put margins on top of that and people come in and say, 'You are dear'. But we are not dear. We are just in a situation where we don't buy as much and we don't control the market."
Mr McLean said that when the two big players went to battle on price, it was the locally owned pubs that were "collateral damage".
"The independents are having to reinvent their business daily to keep up with these juggernauts," he said. "They are locusts. They consume every natural resource and move on."
Katter's Australian Party has a policy where it aims to break up what it considers to be anti-competitive practices.
"This duopoly is bad for small business and competition and we have a simple solution," recent Australian Party candidate for the seat of Ipswich, Will Keys, said.
"When Walmart got to 20% of the market in the US they were told they couldn't go any further. We would also not allow any one corporation to own more than 20% of any market.
"In the US they have anti-trust laws and we have them here in Australia… but there is no political will to enforce them."
Mr McLean said he wanted to make the point that he had no political affiliation and was not aligned in any way with Katter's Australian Party.
"But I think that anything that encourages competition should be welcomed in this sector," he said.
A Woolworths spokesman told the QT that, "Woolworths makes no apology for delivering good value and we have an industry leading approach to responsible selling".
"Claims by competitors that alcohol sold by them is okay, but alcohol sold by us isn't, should be taken with a grain of salt," the spokesman said.
Coles did not respond to the QT's request for comment.
Mr Keys said there was "a clear and present danger to commercial life in Australia and I really can't understand why the government can't see it and don't address it".
"There is no country in the world that has 85% of its retail locked up in two corporations - Woolworths and Wesfarmers, of which Coles is a division," he said.
"I was talking to an Ipswich publican who told me he had to go and buy from Dan Murphy's because they can't get it any cheaper. That situation needs to change."