We are killing Woolworths, IGA and Coles, says Dick Smith

FOREIGN supermarket giant Aldi could kill off the traditional Coles, Woolworths and IGA supermarkets, according to entrepreneur Dick Smith, and he puts the blame squarely on the customer.

It comes as Woolworths decided to dump SPC Ardmona, Australia's best known tomato brand, to supply produce for its own brand of products.

It will instead buy tomatoes from another Australian supplier who sources fruit from the Murray region in Victoria.

Mr Smith told Fairfax Media the major supermarkets were being forced to cut prices in order to compete with Aldi.

And this was only the start.

"They've either got to get their costs down or match Aldi by substantially reducing staff and their product range," he said.

Mr Smith said you only had to look at SPC-made IXL jam, which costs about 72c per 100g.

The imported Grandessa jam at Aldi costs less than half that.

"Their low overheads affect even simple things, like employment for teenagers stacking shelves.

"They don't have that.

"A typical supermarket has around 100 staff, Aldi has 10 to 15."

Aldi does not use entirely imported products.

It claims to use 100% Australian meat, eggs, and laundry products.

According to Aldi 93% of its dairy is sourced in Australia, as in 91% of its fresh produce.

CHOICE found in 2009 that Aldi stores sold the cheapest groceries, and other supermarkets dropped their prices if there was an Aldi store nearby.

Since then, both major supermarkets have run campaigns highlighting consistently low prices on key products through Coles' "down down" and Woolies' "cheap cheap" campaigns.

Topics:  editors picks supermarkets

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