Here we take a look at the continuing concentration of brand ownership by large multinational corporations.
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In the world of brands, all is not what it seems. Thousands of brands jostle and compete with each other for our attention and money. Behind the scenes we usually find that there is just a handful of corporations behind this diversity. Our new interactive chart explores the dominant players for common supermarket products.
The 2016 report by Choice "Market monopolies in Australia: squeezing out the competition" suggests that "concentration can be defined by the four largest firms controlling one-third or more of the market". With this definition over half the industries in the Australian marketplace are concentrated.
Mary Hendrickson and Bill Heffernan have explored concentration of ownership in a global context. "A major concern about concentration in the food system focuses on the control exercised by a handful of firms over decision-making throughout the food system. The question is who is able to make decisions about buying and selling products in a marketplace." Their work use "CR4" showing the concentration ratio of the top four firms in a specific food industry. Their most recent work, last updated in 2008, can be seen here and here. Information on specifics of market share is increasingly difficult to obtain, as Bill highlighted back in 1999.
Here, in this interactive chart, we have looked at the top 2 players in key grocery sectors in Australia. These sectors all have a high degree of concentration with the top two having over 50% of the market share in most cases.
What is not evident at first glance however is that in most areas private label products (supermarket home brands) take up the third position. Put together with the top two, these three largest players make up between 70 -90%. In some areas it is over 95%. In bread for example private label make up 31% and in-store bakey another 14%.
Supermarkets in all sector areas have a large market share. "Private-label product ranges now account for around a quarter of all supermarket sales" (2017 Retail World report). The main players in supermarket retail are Woolworths with 36%, Coles with 32% and Aldi with 12% . So realistically it is these companies that dominate each sector too. See our Shop Ethical issues page for more on supermarket power and our Retail Duopoly chart for more on their reach beyond grocery.
Make a difference and support smaller Australian-owned brands by following the links from the tiles to our Shop Ethical comparision pages, and shopping beyond the supermarket at food coops, farmers' markets and local grocers and retailers.