Supermarket chain withdrawal means job losses and intrigue

Mystery continues to swirl around the sudden decision of major European supermarket chain Kaufland to abandon its multi-million dollar attempt to establish itself in Australia and whether an alleged conspiracy to keep them out could be duplicated to block leading technology companies from opening here.

Australian Competition and consumer Commission (ACCC) chairman Rod Sims is vowing to investigate whispers that Kaufland was forced out because leading suppliers of fruit, vegetables and meat in Australia privately – and illegally – agreed to not sell to Kaufland, leaving the German-based firm no option but to withdraw.

The decision leaves hundreds of workers hired by Kaufland without a job before they had even started working.

For whatever reason the sudden departure of Kaufland, following the billion dollar crash of home improvement chain, Masters, several years ago amid rumours major brands had refused to supply them for fear of being blackballed by the marker leader Bunnings, have made the local IT scene nervous.

“If it can happen in a market as obvious as supplying a supermarket chain, it can happen anywhere, including IT and start-ups,” one executive said.

The fear is that leading technological companies could combine to close down opportunities for emerging competitors.

Nine newspapers quote Mr Sims as saying the ACCC would look into any allegations of cartels forming in an aspect of business and threatening the commercial integrity. He urged anyone with any knowledge of such practices to come forward.

“Agreements between competitors not to supply certainly raises cartel concerns,” he said.

“The law is pretty clear on that.”

He said that even if the behaviour of some companies was below obvious collusion at a cartel  level it could still be dealt with under the ACCC section on concerted practices.

“We would be extremely keen to talk to anyone who has any information. We have very sophisticated processes for protecting the identity of anyone who comes forward.”

Kaufland has spent an estimated $600 million on property in four states in preliminary preparation for its assault on the Australian groceries market of $90 billion which is dominated by Woolworths, Coles and Aldi.