Woolworths, Coles move online delivery to war footing

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Woolworths, Coles move online delivery to war footing

As ACCC temporarily relaxes anti-collusion regime.

Australian supermarkets and grocers are preparing to move their online sales and deliveries operations to a coordinated war footing to help ensure essential supplies get through to vulnerable and isolated people as the nation increasingly shuts down to arrest the spread of COVID-19.

After more than a fortnight of suspended services and limited deliveries to cope with logistics issues that have left supermarkets stripped of stock, the Australian Competition and Consumer Commission late Monday gave the green light to immediate coordination between retailers.

The interim authorisation allows the grocery industry to “coordinate with each other when working with manufacturers, suppliers, and transport and logistics providers” – collaboration that would usually fall foul of anti-collusion regulations.

It covers Coles, Woolworths, Aldi and Metcash (IGA) “and will also apply to any other grocery retailer wishing to participate,” the ACCC said.

The authorisation does not apply to pricing, an important carve out aimed at preventing any outbreak of price gouging.

Aside from unprecedented demand and limited resources, one of the main reasons supermarkets’ online capabilities and delivery services have been broadly suspended is that stock levels in-store and across the broader supply chain have been hit by successive waves of panic buying.

Last week market analysts estimated supermarket sales were up 25 percent year on year on the back of fear purchasing.

Since then both Coles and Woolworths have been gradually rebuilding their respective online delivery services to prioritise vulnerable and isolated people, with varying degrees of progress.

Woolworths has launched what it calls a ‘Priority Assistance’ that requires people to register and provide supporting documentation about their circumstances.

The link to the Woolworths application form is here.

Woolworths says it will review and respond to requests within 48 hours, with eligible customers listed as “seniors, people with a disability and those with compromised immunity or who are required to self-isolate.”

Coles is also in the process of launching the more onerous sounding Coles Online Priority Service (COPS) but is telling customers it will not be ready until next week.

According to Coles the COPS service “will be phased [in] to ensure we can meet the delivery needs of our customers most in need at this time.”

Both supermarkets will carry limits on many stock items to guard against binge buying.

A Woolworths spokesperson told iTnews that it is now “ramping up delivery capacity out of our dedicated online customer fulfilment centres in order to service as many vulnerable customers as possible.”

“We understand the decision to suspend delivery operations out of our stores will be incredibly frustrating for customers and apologise for the inconvenience it will no doubt cause, the Woolies spokesperson said.

“It is a difficult but necessary decision that will allow our store team members to prioritise the restocking of our shelves in the face of unprecedented demand.”

A spokesperson for Coles told iTnews it is “introducing some temporary measures across our online business during the coronavirus outbreak to ensure that all Australians have access to their share of grocery items.”

“These measures will help ensure people’s safety and wellbeing, while also ensuring we can continue to provide food and groceries for all Australians,” the Coles spokesperson said.

“We have a dedicated team working through a list of vulnerable customers and businesses (such as nursing homes, child care centres, remand centres, charities and disability agencies) and we will be in touch with them in the coming days to determine how we can continue to deliver to them during this period.”

The Coles spokesperson said remote delivery customers still had access to place orders through the Coles Online website “in conjunction with their third party delivery provider.” 

Aside from the general online pile on – which yesterday choked myGov – grocery retailers have faced a raft of physical and legal challenges to keep operating.

They include getting restrictions on delivery windows lifted, and access to emergency labour supply, like lifting the number of hours students on visas who can work.  

At the same time the Department of Home Affairs has formed “a Supermarket Taskforce” to break the retail logjam with “representatives from government departments, supermarkets, the grocery supply chain and the ACCC” on the body.

The interim authorisation issued to supermarkets Monday evening flowed directly from recommendations of the Supermarket Taskforce.

“We have worked very swiftly to consider this interim authorisation application, because of the urgency of the situation, and its impact on Australian consumers,” ACCC chair Rod Sims said.

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