Woolworths boss Brad Banducci has defended the quantity of food the supermarket large rejects with a prime government saying nobody desires a banana that’s “too big”, a South Australian parliamentary inquiry has heard.
The state choose committee investigating grocery costs is one of several inquiries currently underway across the country, together with one being led by the Australian Competition and Consumer Commission (ACCC).
Committee chair Robert Simms grilled Mr Banducci and Woolworths chief business officer Paul Harker on Tuesday about food waste, mark-ups from suppliers and rising costs amid cost-of-living pressures.
Mr Banducci denied the corporate engaged in food dumping, saying its reject price is about “1 to 1.5 per cent”.
“We reject very little when it comes into our business, that doesn’t mean that it’s not rejected before it gets to our business if you know what I mean, I think there’s an opportunity there,” Mr Banducci stated.
“I think we already acknowledge that food waste at farm and actually at home are the two big opportunities.”
Mr Banducci stated rejected produce is redirected to households in want and farmers however took a query on discover concerning how a lot every of these teams obtained.
Mr Harker stated product requirements are primarily pushed by consuming high quality and its longevity.
“No one wants unripe strawberries or capsicums with mouldy centres and the like,” Mr Harker stated.
“There are some aesthetic, there’s a banana that can be too big.
“Lots of people who eat bananas are youngsters and youthful individuals who don’t desire one thing that is round this massive,” Mr Harker said as he gestured about 30 centimetres with his hands.
“They need one thing that is cheap to eat in a sitting as opposed to it contributing to food waste at house by solely having the ability to eat half of it.”
Mr Simms said the community would be “astounded” to hear a giant retailer discarding fruit simply because it’s too large.
“I’m undecided that most individuals in the neighborhood would agree that a big piece of fruit represents a security threat, however I’d let others be the choose,” Mr Simms stated.
Consistent costs for purchasers
The outgoing Woolworths CEO did not support price regulation but said the supermarket giant has offered more product choices to customers as well as being overt on unit prices for better “transparency and readability”.
“Regulation of 28,000 merchandise that change dynamically each week could be an extremely laborious factor to think about how you’d do it,” Mr Banducci stated.
Mr Banducci said unlike some of its competitors, food prices at Woolworth stores are the same across the country, with few exceptions in “extraordinarily distant” areas.
His response adopted Australian Bureau of Statistics knowledge that exposed Adelaide had the biggest grocery price increase in the country at 16.4 per cent between 2021 and 2023.
“Various the opponents that we compete with throughout the nation, together with in South Australia, wouldn’t comply with the identical pricing guidelines,” Mr Banducci stated.
“They would value base on a location, whether or not they’re shut to a Woolworths or not, so their pricing will flex up rather more than ours would.
“When we look at overall price index, I’m very focused on making sure it’s extremely competitive against Coles but critically important for us, Aldi.”
Mr Banducci additional argued that Woolworths has been “a great mechanic in driving prices down” however stated it has been cautious not to create “unintended consequences” for farmers.
Last month, SA’s vegetable business affiliation AUSVEG informed the committee there was a mean 300 per cent mark up between farm gate value and what the patron pays.
Mr Harker added that the supermarket buys at wholesale costs, which is twofold of farm value “because we’re paying for people who can grade, pack and deliver finished food”.
“The farm gate price is not the price that we purchase goods at,” Mr Harker stated.
Mr Harker stated Woolworths doesn’t have interaction within the apply of flooding the market, the place producers are pressured to develop greater than wanted, in flip decreasing their sale costs.
“Pricing is finally decided by provide and demand,” Mr Harker said.
Mr Banducci said if Woolworths chose to make no profits, customers would save about $5 a week on their grocery bills.
He stated he didn’t obtain a pay rise as a part of his exit pay package deal and final yr retailer staff obtained wage will increase of greater than 6 per cent with superannuation.