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Only about 3% of the price you pay at Coles and Woolies is their profit, the rest goes to suppliers and their running costs or tax, I wouldn't call a 3% profit margin gouging.


It's a pretty competitive market, if Coles and Woolies were making excessive profits, some one else would come on the scene and offer the same service for less, and steal a chunk of market share.


However, so far their competitors have to either offer less service or charge higher prices.


Eg, Costco and Aldi are examples where they charge lower prices but only do so by providing less service, while IGA, SPA and other market participants have a niche market but generally have slightly higher average prices.


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