A former Woolworths executive said she didn’t understand how the company expected suppliers to give rebates, despite being involved in helping executives get bonuses.
The executives were questioned by the Competition and Consumer Commission about the company’s relationship with its suppliers during an investigation into the supermarket industry’s increasing profit margins.
During the hearing, the company claimed that the supermarket industry was competitive, despite its dominance by Coles and Woolworths, which has a combined market share of 67 percent.
Natalie Davis, who was the managing director of Woolworths before she was replaced, said she didn’t consider the rebates when she was in charge.
When asked if she knew about the rebates, Davis said she did not.
Mick Keogh, the deputy chair of the Australian Competition and consumer Commission, questioned why Ms Davis was signing off on bonuses even though she did not know what rebates were.
The executives were questioned by the Competition and Consumer Commission about the company’s relationship with its suppliers during an investigation into the supermarket industry’s increasing profit margins.
In an interim report, the commission noted that some of the suppliers had raised concerns about the way the supermarkets fund their sales.
Naomi Sharp, the counsel assisting the investigation, was offended by the way Woolworths referred to the company’s only access to around 20 to 25 percent of Australia’s fresh vegetable and fruit supply.
Brad Banducci, who was the former chief executive of Woolworths, said that the company only accessed about 20 percent of the country’s total fruit and vegetable supply.
Despite being a major player in the supermarket industry, Woolworths maintains that it doesn’t consider its suppliers to be unimportant.
On Monday, the company defended its decision not to actively notify customers when its home brands experienced deflation.
In addition to being able to maintain profitability, the practice of package downsizing helps brands by reducing product lines while keeping the price the same.
Amanda Bardwell, the new chief executive of the company, said that she did not want to add in-store and online notices to inform customers about when their products experienced deflation.
According to her, customers wanted to see the unit pricing in all its forms and tickets should already have been made clear.
The commission is currently investigating the practices of the two biggest retailers in Australia. It has also launched legal action against the companies for deceiving their customers.