heyy this is an interesting article i found online and it is a piece of recent news with regards to price discrimination, which is relevant to the last few lectures so i thought i should share it with the class..

IF ANYTHING was clear from the grocery inquiry's colourful hearing, it was that Australian Competition and Consumer Commission chairman Graeme Samuel wasn't going to let the head of the independent grocers association John Cummings off easily.

Mr Cummings, chairman of the National Association of Retail Grocers of Australia, took a swipe last month at Mr Samuel and effectively accused the consumer watchdog of neglecting its duties because, among other things, it had not reduced Woolworths' and Coles' majority share of the grocery market.

Mr Samuel responded that people with "vested interests" would face "rigorous examination" and have their claims tested during the inquiry. And so they have.

Mr Cummings' main proposition to the inquiry in Canberra yesterday was that because the two big chains have 80% of the market — although the exact level of market share is still being debated — they can set prices as high or low as they want and rip off consumers.

He said prices for basic items were usually higher in areas without independent retailers, and that there was price discrimination on milk. "I cannot buy milk at the same price as Coles and Woolworths do," he said. The association wants the Government to strengthen the Trade Practices Act to prevent Coles and Woolworths from buying out smaller supermarkets, end price discrimination, and ensure more transparency in the supply chain.

Mr Cummings, who owns three independent supermarkets in Perth, told the inquiry that about 40% of his business wasn't profitable. After compelling him to answer some uncomfortable questions, Mr Samuel asked why the association did not pressure Metcash, the main supplier for independent IGA stores across Australia, to lower prices. Mr Cummings said that was not the association's role.

The inquiry continues.

THANKS for being so enthusiastic in participating in the econs blog...=0 and perhaps u all can try posting some articles as well?

junxin