Inside Retail Weekly

2075 Inside Retail Weekly

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2015 – the year in review for retailers BY JARED DICKSON I N S I D E T H I S I S S U E : The past year may not have had as many financial crashes as in some other years, but it has left a number of major retailers battered and bruised. Topping the list of retailers keen to see the back of 2015 are Woolworths, 7-Eleven and Dick Smith, but Myer, Harris Scarfe and Metcash would also be keen to put the past year behind them. The torment at Woolworths has been well documented with the retailer's earnings falling as sales growth eased, management changes within its businesses, a tumbling share price and, at year's end, another round looming in the courts. The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against Woolworths, alleging the retailer engaged in unconscionable conduct in dealings with a large number of its supermarket suppliers in a bid to shore up its earnings. The ACCC alleges that in December 2014 Woolworths developed a strategy, approved by senior management, to urgently reduce Woolworths' expected significant half-year gross profit shortfall by seeking payments from 821 'tier B' suppliers under a program dubbed, 'mind the gap'. Woolworths is accused of pressuring the suppliers with demands of up to $1.4 million to 'support' Woolworths, despite not having any pre-existing contractual entitlement to seek the payments towards a $60.2 million income target for the 'mind the gap' program, which ultimately captured around $18.1 milion. While the contravention of competition laws occurred in 2014, the court proceedings have only just started in the Federal Court, with the first directions hearing listed for February 1, 2016. The ACCC is seeking injunctions, including an order requiring the full refund of the amounts paid by suppliers under the 'mind the gap' scheme, a pecuniary penalty, a declaration, and costs, with Rod Sims, the regulator's continued on p.6. RRP $14.95 INSIDE RETAIL WEEKLY FEATURE: The Academy Brand Anthony Pitt on building a brand, not a label. p16 OPINION: Retail associations Is the National Retail Association doing its bit for its members? p24 NEWS: Harris Farm's new crop Harris Farm Markets launches new Sydney flagship. p02 NEWS: Melbourne to host Retail Fraud 2016 World's largest loss prevention conference coming to Australia for first time. p03 FEATURE: Stockland's new creation Inside the alluring, newly redeveloped Stockland Wetherill Park. p12 PROPERTY: E-commerce E-commerce's impact on retail property – and what it means for rent flexibility. p22 Inside news and views on the world of retail since 1972 Dec 16 2015 F O R M O R E R E T A I L N E W S , V I S I T W W W . I N S I D E R E T A I L . C O M . A U I S S U E 2 0 7 5

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