Coles is obviously very concerned about negative publicity they are receiving over their part in the current dairy industry crisis and are spending mega dollars on PR spin. This week Coles launched themselves back into the world of social media after many previous disasters with an animation full of half truths
In regards to my efforts to counter the half truths I don’t make billion dollars profits nor am I on million dollar bonuses so I cant afford to engage consultancies like Coles. So in this post I relying on various types of industry intel and my knowledge of the behind the farm to glass scene so I am happy to stand corrected Coles. The last thing I want to do is perpetuate half truths
I also cant afford to engage graphic artists to create expensive animations for me so I will have to work with what is out there and this nice little picture above that Dairy Australia has created to tell the farm to glass story is pretty impressive. So lets start with that
Fact– As as you can see there is quite a process involved to get the milk from the farm to your glass. Did you know along the way the industry directly provides more than 40,000 jobs.
Nobody (not even Coles) is going to deny the dairy industry is in crisis for all sorts of complex reasons. However admit it or not Coles is part of the problem and to date they are refusing to be part of the solution. So I think its fair to say that’s 40,000 jobs Coles is helping to put in jeopardy
Below are few more bits and pieces I have collated by chatting to people along the supply chain including a few Coles employees.
Lets start with those consumer complaints that when they walk into Coles the shelves that stock the Dairy Farmers brands are almost always empty.
Fact- This is because Coles staff are directed to refill the home brand shelves 3 to 1. So for example in one 12 hour period they will restock the Coles brand milk 9 times compared to the say the Dairy Farmers brand three times.
There is no mention in the Coles animation of their new direction in the milk prices wars of “offering $1 per litre milk through more than 600 Coles Express outlets Australia-wide in what is seen as a direct attack on the traditional corner shop – a sector which is already suffering in the cross fire supermarket giants’ food price war”.
Now as I mentioned in a previous post convenience stores are part of what is known as the route trade. This graphic below shows the route trade. How many people have family members who work in the route trade?
Fact- Coles are up 6 points and route is down 8 points in the last year.?
How safe are those jobs now that Coles is gobbling up the route trade business?
Lets get back to the dairy farmers and Coles apparent benevolence towards them .
This picture above is part of the animation Coles claim dairy farmers were getting 86c/litre before the milk price war and now their getting 90c/litre. As Angus White quite correctly reminds Coles in this comment on their YouTube page
Not only are they claiming dairy farmers get more that two to three times what they do they are actually claiming they are getting more now then what they did 2 years ago when the milk price wars started. If that’s what your consultant told you Coles I’d be asking for a refund
Coles is also spruiking “To further protect farmers, our milk contracts with processors all contain a “rise and fall clause” so if they increase their farm gate prices for farmers, the price we pay will rise.” This begs the question why haven’t the processors taken up the the “rise and fall clause” . Me thinks it might be fear what do you think?
I could go on and on like the Coles animation but we all know Coles is growing the size of their bank account not Australia.
As Halter so correctly points out here
We forget, there are no free ‘lunches’ as they say – every action has a reaction – somebody pay’s for the ‘discount’ and ultimately it’s all of us. How often did you hear this behaviour rationalized as ‘the need to take the opportunity to save on groceries’.
Fact – Coles recorded a 16.3 per cent increase in 2011-12 pre-tax earnings to $1.356 billion.
I think that fact alone says it all – strange its not in the animation!!!!