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Coles sales drop due to plastic bag ban

Coles8Wesfarmers has seen an impact on sales as a result of the decision to phase out single-use plastic bags in Coles supermarkets, according to comments made by the conglomerate’s chief financial officer to The Australian.

Anthony Gianotti, Wesfarmers CFO, noted that forcing customers to use their own bags, or reusable plastic bags, has had a knock-on effect on sales as customers were taking longer to move through check-outs.

“Certainly one of the reasons why we extended the free plastic bags was because customers were taking some time to adjust to that and there was no doubt there was an impact (to sales)”, said Gianotti.

“I’m not going to go into the specifics around the quantum but there was certainly an impact as consumers had to change their habits around shopping.

“When we looked at the overall number there was definitely an impact and I guess it wasn’t uniform across the board, but there was an impact.”

He also admitted the phase-out could have been handled better, noting that while Coles was trying to the right thing, there has been miscommunications along the way.

“I think there was certainly never any intention to continue providing plastic bags free, forever, I think it was more of a transitional arrangement and I think it probably got lost in translation to be honest.”

Gianotti denied Coles would profit extensively from charging 15 cents per reusable bags, refuting earlier claims by Queensland University of Technology Professor Gary Mortimer, who stated the major supermarkets would be set to rake in around $71 million in gross profit from the initiative.

Mortimer also calculated the supermarkets would save $170 million a year by not providing free plastic bags.

Wesfarmers and Woolworths have been contacted for comment.

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