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Competition watchdog to investigate concerns over Woolworths’ B2B plans

Australia’s competition watchdog, the ACCC, said it will investigate concerns raised about Woolworths’ plans to expand its B2B arm.

Woolworths is set to launch a tailored online shopping site for early learning centres, education, disability and care services, but some suppliers have voiced concerns about the retailer operating under the same terms for the B2B site as in its supermarket business.

The ACCC said it will look at whether Woolworths’ plans will harm competition in the industry.

“The ACCC is looking into concerns raised about Woolworths’ expansion into the B2B sector,” an ACCC spokesperson told Inside Retailon Friday.

“We will examine whether these plans are likely to have an adverse impact on competition, rather than simply an adverse impact on individual competitors.”

A Woolworths spokesperson told Inside Retail it will assist the ACCC with any questions it has.

“Many of these businesses already shop for key groceries like snacks, drinks, toilet paper and cleaning products in Woolworths stores or our consumer website. This doesn’t work as well as it should for them or us,” the spokesperson said.

“We believe they would benefit from having a dedicated website, consolidated invoicing and easy-to-use expense reporting. That’s why we’re developing a convenient extension of our existing online grocery business for these organisations.”

The new online shopping site, which was first reported by the Australian Financial Review, is set to launch this month, offering an improved experience for business customers by giving them access to account management, centralised invoicing and consistent year-round prices.

Many businesses currently shop for food and groceries either in-store or on the consumer website, a Woolworths spokesperson told Inside FMCG in early July.

“We know we can improve their experience with a tailored online offering.”

Dr Geoffrey Annison, acting CEO of the Australian Food and Grocery Council (AFGC), told Inside Retailat the time that a number of suppliers had come to the association with concerns.

“When the supermarkets deal with the suppliers for the retail trade, [the] trading terms are based on understandings of promotion […] both in-store and outside store,” he said.

“They’re taking those prices over to a different model. And the question is whether that’s appropriate or not.”

A Woolworths spokesperson said the retailer is working with its trading partners to ensure the new channel delivers value for suppliers as well as customers.

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