What Shopping At Woolworths, Coles And ALDI Actually Costs

We're constantly bombarded with advertising for supermarket specials, but is any one chain consistently cheaper than the others? A new investigation by consumer advocate CHOICE suggests not — and highlights again how much more we pay for brand-name goods rather than house brand alternatives.

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CHOICE examined the cost of a basket of 31 items at Coles, Woolworths, ALDI and IGA at 93 supermarkets across Australia. (Major supermarket chains generally claim to have consistent pricing across each state, but there are often variations between the eastern states and those further west.) CHOICE noted prices for both major brands and the house brand equivalents.

The big conclusion CHOICE reached was unsurprising, and is one we've highlighted many times before: you'll save a lot of money if you choose to purchase house brand goods rather than the nationally famous brands. The average price for its basket of goods in Coles ($174.97) and Woolworths ($176.77) was much higher than in ALDI ($87.68). To a large extent, that reflects the fact that ALDI generally only stocks its own brands, except in a handful of cases (Vegemite, Coke and a few others).

The difference was still apparent — though much less marked — if the same basket used the house brand items in all three stores. In that case, the Woolworths basket added up to $119.40, the Coles basket to $114.24 and the ALDI basket (again) to $87.68.

What lessons can we learn from this? Firstly, it's always worth checking out house brands to see if they meet your needs. There are no absolute rules here: some will be fine, and some won't be. Even if you're incorporating other principles, such as only buying Australian-made goods, there are still house brand options in many categories.

Secondly, the price difference between the major full-service chains isn't huge — only $1.80 between the Coles and Woolworths baskets when filled with "brand name" products. Given that specials oscillate between supermarket chains on a regular basis, it's a reasonable assumption that if the survey had been conducted two weeks later, the difference might have fallen the other way.

This point is evident in the following table, which shows the average price of a basket from Woolworths and Coles in each state with specials included, and with specials ignored. This also reminds us that prices vary across states, though not by a really massive amount. (CHOICE's research focused on populated locations where there were competitor supermarkets operating; I'm sure prices are much higher in rural areas with just a single operator and higher freight costs.)

State # stores Average
(no specials)
Average
(with specials)
ACT 4 $174.04 $163.60
TAS 4 $174.88 $166.55
NSW 18 $175.06 $166.81
VIC 12 $175.63 $167.01
SA 8 $175.93 $167.24
QLD 8 $176.46 $168.53
WA 8 $177.70 $169.71
NT 2 $180.41 $170.25

Supermarkets monitor prices at their rivals keenly and match pricing on most goods, both at the cheap and expensive end of the scale. That phenomenon also suggests, as we've discussed recently, that ALDI may be better off sticking to its no-frills roots than trying to compete in this space.

We've not said much about IGA here, but the reality is that as an independent alliance of stores, its products are almost always more expensive. IGA often operates in areas where Woolworths and Coles don't believe they can be profitable, and its pricing reflects that.

The bottom line? The rules for sensible supermarket shopping don't change. Hunt down good specials on items you like, identify products where you're happy with the house brand alternative, and monitor prices carefully. That works no matter which chain you end up using.

CHOICE

Lifehacker's Loaded column looks at better ways to manage (and stop worrying about) your money.


Comments

    That's a great article Angus.
    The other variables that come to mind include your proximity to shops (petrol to get there) and the actual quality of a product.
    I tried the Coles noname ice blocks a few days ago and they are FAR nicer than the Woolworths noname iceblocks. The Coles ice blocks also weigh 150g more. In this instance, you can't quite compare apples with apples because you have quality/taste/quantity differences. For this single comparison, the $3.79 at Woolworths is expensive compared to the Coles $4.13 because the Coles product is much better quality. I'd happily pay the extra 35c for 150g extra plus much better taste.

      You've got to remember they've both got their two versions of their homebrand too.

      Like a 'No frills' and a 'Select'

        Someone told me they are starting to go for 3 tiers. Cheap, select and a real premium one. Anyone seen this at all? I haven't seen a thing.

    What this article fails to address though is the long term impact to suppliers.

    Buying house branded items simply tightens the strangle hold that supermarkets have on supply chains.

      Unfortunately, living in a single income family with 2 young children my only option is to consider my own pocket and buy own brand goods and the profits of the suppliers cannot be a factor in my purchasing decisions. I imagine this to be the case with a lot of families out there.

        So many of the house brand items are crap though, I tend to cut down on other things and try to have good quality, enjoyable food for the family. Food is a priority at our place, and one of our great joys, so pretty much anything else goes first. We cook most things from scratch though, so our food bills are still relatively low.

        I agree with you, when you live on a very tight budget, profits of the suppliers are the least of my concern. Feeding my family is. Plus I found that most of the own brand goods in Aldi are quite comparable to known brand ones.

    No surprise here that Aldi's off-brand merchandise is cheaper than the brands. That shouldn't even be news. What should be news is that Woolies' and Coles' off-brand merchandise is still 30% more expensive than Aldi's off-brand options. Personally, I don't buy any of the Aldi off-brand products any more. The few that I tried were simply inferior. I do however, buy a few off-brand products at Woolies and Coles -- primarily canned goods and condiments such as olives or sun-dried tomatoes.

      See this is great, you've tried the Aldi off-brand ones and found them inferior and gone back to Woolies or Coles. To me this is evidence that having the big guys like Woolworths and Coles and then the budget option of Aldi creates a good variety of places to shop and people really have a choice. I used to do a lot of Aldi shopping when money was tight but these days my finances are healthier and I'm back to Coles trying to rack up Flybuys points. I still do the occasional Aldi shopping as I do enjoy seeing what the weekly specials they have.

        But, idolat3, there's a false economy in worrying about Flybuys and Everyday Rewards.

        To get enough points to make a difference, you have to spend a king's ransom. An $80 per week spend at Coles for five and a half years does not rack up enough points to get a one-way Qantas ticket Sydney to Hobart. (Although one can get to Melbourne or Brisbane ... but not back!)

        About three years ago, a quite elderly man in front of me at the Woolies checkout was in tears and inconsolable when his little shop of groceries ONLY came to $29.93. I asked him what was wrong and he told me that he needed to get over $30 to save 4c per litre on his fuel. After some discussion, I realised that he only drove to the newsagency and back every day and to Woolies once per week from just west of our township. It was soon revealed that his average fuel buy was only $7 to $10 weekly. So, in essence, this man was in tears because he was worried about spending 7c to 10c more to make a saving of about 23c or 25c on his fuel.

        The worst part of Flybuys and Everyday Rewards cards is the tracking and tracing. Coles and Woolies build up quite a dossier on you when you shop. Their computer systems know your common spending habits and the regular items you (and everyone else) buy.

        Your Aldi experience also surprised me. When generic brands have been blind taste-tested and value-tested over the years by consumer groups and TV 'current affairs' programs, Aldi products lead in nearly every category. I would not continue to use a product that wasn't doing its job or a product that didn't taste right but I have found that Aldi cleaning and laundry products are better value and do the job just as well or significantly to other stores' generics or many higher-priced brand name products. Aldi dairy products are great and most of my circle of friends like the breakfast cereals and chocolates there.

          What is the rewards program for the rest of Australia's Woolworths?

          In Tasmania, Hobart region, we had Purity, which was branded as the Fresh Food People. There was a different one up north. Pretty sure Woolworths owned them by then. They slowly transitioned them to the Woolworth's name but they kept the rewards program to avoid a massive backlash. Basically, you would get 1 point for every dollar spent. Then you would get vouchers in the mail. 1 point = 1 cent. Every now and then they have double points days.

          So you basically get back 1-2% on what you spend. I was not aware that this didn't happen in the rest of Australia till my grandfather told me he tried to use it in Melbourne or somewhere, and they had no idea what it was so gave him the staff discount.

          Ah but I assure you Iain, I understand that very well. I didn't say that I'm now shopping purely to rack up Flybuys points, god no. I'm very surprised that you singled that out from my post!

          As for my Aldi experience, I think you misread my post - I was referring to Barbs' experience. I love Aldi and I can't complain about the quality of their products. Currently I've gone back to Coles simply because if I spend half my budget for groceries there (which amounts to $100 a fortnight) for 2 months, I can rack up to 200,000 over points and I can get a free stay in a hotel somewhere. False economy or not, I like the idea of doing that. After this, I'm gonna say screw Flybuys (until the next lot of promotions come up) and I'm still going to go back to Aldi, and also my fortnightly visit to the Dandenong markets to shop for my groceries. Coles, Woolworths and Aldi are all along my route to work and therefore I don't have to drive more to shop in any one of these places.

          What I'm saying that it is great that we can choose wherever we want to shop, when it suits us at the time. Just don't be too caught up with some of the arguments people make about Aldi quality is crap or Coles and Woolworths are robbing us or whatever. I'm happy that they all exist, so I can shop however it suits me. I even go to IGA for specific indulgent products that they stock.

          But in saying that, I like the examples you presented in your reply, that is a good example of how people need to really think about how, why and where they are shopping and at what cost. If the cost of getting to the supermarket outweighs the saving you are going to get, then perhaps rethink if you should be doing it.

    Woolies and Coles have specials quite often (as mentioned in the article) and because a lot of cleaning supplies and other items have a long shelf life, you can usually stock up early and stick the extra supplies in the garage/pantry and use which amounts to long term savings, even though it may mean a higher upfront cost. Often, Coles seems to be the best middle ground where they have better prices and specials than Woolies on name brands that even's them out with a lot of Aldi pricing (to an extent).

    Looking forward to Coles and Woolies reigning in their prices once Aldi opens in WA. I get the cost of shipping etc, but there is definitely a duopoly factor involved as well.

    P.S for those in WA, give Spudshed a go. Their prices are constantly lower than the chains. Albeit, their range is not as vast.

      Spudshed used to be great years ago, when they were a shed selling their own grown produce. I don't believe that everything they are selling now is even grown in WA! I think that the quality is far inferior to that sold by my local fruit and veg store and the price doesn't seem any better.

    It's possible to get brand name items on half price special. When this happens the price usually works out cheaper than the standard price of the generic brands. If you know the specials pricing cycle well enough and your usage needs, you can stock up from half price special to the next half price special without ever having to get the generic product between times.

    Aldi does NOT pay the right tax like Aussie companies have to. NOT a level playing field. Poor range of stock, poor customer service at Aldi.

      Your evidence for this?
      Or just another sweeping anti-Aldi disinformation?
      Less or more tax than lots of big resources companies?

    If Aldi's products are SO good and SO much cheaper, wouldn't everyone migrate to them? How are Coles and Woolworths still in business?

      Well, for starters Woolworths and Coles are in far more locations. I have a friend who refuses to shop at ALDI purely because you have to pack your own bags. Choices differ, and people don't always choose where they shop purely based on its being the cheapest.

        Back their own bags? Seriously? Sounds like a 1st world problem to me.

    " and I'm back to Coles trying to rack up Flybuys points"

    I thought everyone knew what a scam that was.

      Flybuys isn't a scam. Admittedly the base points are only worth 0.5% but if you use the bonus points scheme carefully you can get flybuys to pay for between 10% and 25% of your groceries.

    A $10 item at ALDI is usually priced about $20 at Woolworths. When this item is on a special price in Woolworths, it would be about $15. Comparing a regular priced item at ALDI with the same/similar item, but discounted, at Woolworths, I would be paying 50% more at Woolworths.

    I prefer to pay $10 instead of $15 for the same/similar it. I think saving 50% of money is helpful so that I can offer to someone suffering in need. Giving 50% more to Woolworths is wasting my money on the fat-cats in Woolworths.

    If I have to choose between Woolworths and Coles, I'd go to Coles any day. The service personnel in Coles are excellent. Attitude of Woolworths service personnel in self-checkout bay is of outright rejection; they don't like customers in self-checkout bay.

    My choice:
    #1 Aldi
    #2 Coles
    #Last Woolworths

    I feel welcomed in ALDI and Coles every time. I feel good there.

    In Woolworths, I feel as if I am unloved, unwanted, an interruption in their work or a pain in their backside. I feel rejected by Woolworths.

    I feel like this article is missing a key point: If you are prepared to buy house brands, then all shoppers should go to Aldi! Their house brands are as good or better, and they are heaps cheaper. I just can't understand why people aren't abandoning Coles and Woolworths in droves. Yes, Aldi is a bit different, but it takes no time at all to get used to them and they are heaps more efficient in what theis whole business model, which is why they are heaps cheaper!

    I dont buy many big brand food anymore. Although the popular brands may taste a little better its because they use MSG, Fat, sugar colours and additives. Read the ingredients and you will find the big brands are big because they have people addicted to there crap. Just look at things like smiths chips and the big noodle brands. Then compare them to the cheaper no brand products from also. Save money and don't give yourself bowl cancer its a win win!

      Aldi is the most shonky of all the supermarkets with crap stale products. Wonder why all Aldi sores in Australia are so cheap.? It is because all there dodgy products are rubbish. You can't make good products and sell them cheap it is 100% impossible to do and never ever will be possible to do.

      Aldi would go broke with in months if they made good quality products cheap. It would cost Aldi more money for good quality products, so you see they could not sell them cheap.

      The only reason Aldi is so cheap is the products they have are cheap to make and a certifiable rubbish. You get what you pay for this is 100% truth based on facts and evidence. Want to be sick buy Aldi food.

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