Aldi CEO promises virus will not impact prices
As Australia continues to ‘flatten the curve’ of the Coronavirus outbreak, supermarkets are showing hints of a return to normalcy. Supermarket stockpiling has eased, online services have resumed and some product limitations have been lifted.
But with many consumers feeling the economic hit of COVID-19, the price of essential items is a key concern. In January, Australians were warned of higher grocery prices following devastating bushfires, and now the pandemic is fuelling higher prices at supermarkets around the world.
Reuters reported that in the US, food prices moved higher by 0.3 per cent last month. Combined with the gain in February, when hoarding had already begun, the rise in the last two months is the most since 2014.
Closer to home, discount supermarket Aldi has moved to reassure shoppers that it will continue to keep prices low amid the challenges conditions.
In a letter to customers on Tuesday, Aldi CEO Tom Daunt reaffirmed Aldi’s commitment to providing “the lowest prices, every day”.
“Despite these changing behaviours, we are acutely aware that many Australians are facing financial uncertainty right now. Our promise to you is that Aldi will never be beaten on the price of your weekly grocery shop,” Daunt wrote.
Rival grocery retailers Coles and Woolworths reinstated their online grocery operations last week following a surge in demand. With no online grocery presence, price remains Aldi’s key point of difference.
Daunt said the retailer’s unique business model and partnerships have enabled the supermarket to keep costs low.
“For almost 20 years Aldi has been building long-term partnerships with Australian primary producers and manufacturers. Our unique business model and these partnerships allow us to provide high quality products at the lowest prices,” he said.
In an update on Coles’ website, the retailer said it is also working to keep prices lower.
“We’ve been working hard to keep helping lower the cost of your weekly shop during this time, and we’ve made some changes to our digital catalogue to make shopping our weekly specials, meal solutions and recipe inspiration even easier,” the update reads.
The supermarket is encouraging shoppers to follow recipes on its website and YouTube channel through its ‘What’s For Dinner?’ campaign featuring chefs Curtis Stone, Colin Fassnidge and Courtney Roulston.
Daunt also noted that food has taken on an even greater meaning during the pandemic, as consumers are compelled to stay home.
“We are seeing customers expand their shopping repertoire and many of us have been inspired to bake and create dishes to share with others. Cooking with kindness, it seems, is back on the menu,” he said.
Despite demand remaining high for certain goods, the major supermarkets are gradually lifting purchase limitations.
“The demand surge of a few weeks ago is undoubtedly calming, with many people returning to buying what they need and signs also suggesting that the average Australian household has almost two weeks worth of typical pantry items at home,” Woolworths CEO Brad Banducci said in an update to customers on Friday.
While the retailer was able to lift limits on paracetamol, ibuprofen, cold remedies and body wash, toilet paper remains a high demand item.
“It’s up to 14.1 million rolls this week, more than last week’s 11.5 million, but not at the highs of 20 million we saw a few weeks ago. It’s likely driven by having much more supply available,” Banducci said.
Inside FMCG has contacted Woolworths and Coles for comment on grocery prices amid the pandemic.