Supermarket Wars: The 85 Cent Loaf Of Bread

For many years, Australia’s supermarkets tacitly agreed that the cheapest loaf of bread for sale would be a 650 gram white loaf for $1. Now Woolworths and Coles have decided that’s apparently too expensive, and are selling that same white loaf for 85 cents.

The strategy marks an interesting shift for Woolworths. When we did a round-up of stuff you could be in supermarkets for less than $1 in early July, Woolworths was selling its Home Brand white loaf for $1.15 — 15 cents more than Coles, and 16 cents more than ALDI. Within a few days of that study, Woolworths smartened up its price-matching act a little, and took its basic white loaf pricing back down to $1. This latest drop means that that loaf has dropped in price by 26 per cent in just three months.

When I checked Coles and ALDI over the weekend, both had stuck with their $1/$0.99 pricing. However, it appears that Coles has now matched the Woolworths price.

None of this will make any difference to your shopping if you prefer your bread fresh-baked or multigrain. And even if you do regularly and happily consume basic white loaves, that 15 cent saving isn’t going to let you buy something else straight away. (The only thing you could conceivably buy for 15 cents in a supermarket these days would be a tiny quantity of vegetables, nuts or deli produce.)

Over the course of a year, if you purchased one loaf a week from Woolworths or Coles, you’d save $7.80 with this new price. If you’re on a tight budget, every cent counts (and you might be happy eating a lot of toast sandwiches).

The other contentious aspect of super-cheap supermarket food is the claim that the major chains make it impossible for independent providers to compete, forcing them to sell products to the supermarkets at unsustainable prices. That argument is going to be tested in a court case between the ACCC and Coles.

Update: Corrected article for weight at Woolworths and Coles, which is in fact 650 grams.

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