More Aussies snubbing local butchers in favour of supermarket giants

It turns out Australians may not be as supportive of small businesses as they make out to be.

A new report by Ray Morgan has found that Aussies are more likely to purchase meat from Coles and Woolworths than they are local butchers. This means more people are relying on the two supermarket giants for barbecue favourites including steak, sausages, minced meat, chicken drumsticks and lamb cutlets, just to name a few.

The analysis claimed that 50 per cent of Australia’s $13 billion fresh meat market is a result of meat sold in Coles and Woolies. It’s the first time ever the two largest supermarkets in the country have been responsible for such a big chunk of the meat market.

As well as taking away business from local butchers, the dominance by Woolworths and Coles outsells other supermarkets including Aldi and IGA. In 2017, the Woolworths Group dominated the industry with a 26.5 per cent share, while Coles was up two per cent from the previous year and sits on a 24.3 per cent share.

Although popular, Aldi is much further behind, still scooping a 9.6 per cent share of the market. While it’s great news for these supermarkets, the news is not being celebrated by butchers around the country.

A decade ago, butchers and markets had 32 per cent of Australia’s fresh meat market, although the latest report found that it has dipped below a quarter. It sits at 24 per cent, a drop in three per cent from the previous year.

Michele Levine, CEO of Roy Morgan said it was another example of Coles and Woolworths dominating the retail industry in Australia.

“In recent years, the Big Two have been moving to consolidate their market shares in various fresh food markets including fresh fruit & veg, fresh meat, fresh bread, fresh deli and fresh seafood,” Levine said in a statement. “In just the past year Coles and Woolworths achieved a milestone, capturing a majority of the fresh meat market for the first time and now hold 50.8 per cent of Australia’s fresh meat market between them. Woolworths’ fresh meat market share of Woolworths has increased 1.1 per cent points over the past year to 26.5 per cent, while Coles has continued a decade long-trend by increasing its market share by 2 per cent to 24.3 per cent.”

While the numbers for Woolworths and Coles have increased, Levine noted the growing popularity of Aldi in Australia could partly be to blame for taking business away from local butchers.

“As we’ve noted previously, Australia’s supermarket duopoly has been disrupted in recent years by the arrival of Aldi, which has captured a significant market share across categories,” he added. “In addition to Aldi, other foreign entrants are already on the lookout for supermarket locations including giant European supermarket chains Kaufland and Lidl.”

Levine said that with more competition available, the pressure would be felt by butchers and smaller markets over the coming years.

What do you think? Where do you purchase your fresh meat from? Do you support local butchers, or is it easier to buy from supermarkets such as Coles or Woolworths?