Half a century of history can’t save IGA store from Woolworths competition

Friday 10 April marked the end of an era for the suburb of Walkerville SA as the local IGA store closed its doors, unable to withstand the impact of competition from the nearby Woolworths store.

The sign on the door of read “Dear Customers, We regret to inform you that IGA Walkerville is closing down 5.00pm Friday April 10th. Thank you for all the support over the years however due to competition the store is no longer viable…”

The less than 400 sqm IGA store had served the local community for over 50 years, operating under the same management for the past 17 years. However the entry of a new Woolworths store in 2013 sounded the store’s death knell. Not only was the new Woolworths store substantially larger in size at around 2500 sqm, it was also one of five Woolworths stores within a 5km radius.

The store’s closing was met with an emotional response from loyal locals, and will be a loss to the local community. Jeff Rogut, CEO of the Australian Association of Convenience Stores (AACS) commented, “It is always sad to see local businesses and their dedicated owners and staff forced out of business because of the aggressive might of the large retailers. Once a business and the employment opportunities are lost, they invariably do not return”.

AACS has made representations to the panel reviewing competition policy that greater emphasis needs to be given to smaller businesses and their customers. “As an Association, we are primarily interested in competition policy that may impact small business, especially the challenges and opportunities for these smaller businesses and their ability to compete with a supermarket duopoly enjoying an unprecedented market share,” Mr Rogut told C&I WEEK.

The IGA at Walkerville is not alone in the struggle against the might of larger stores and the fight is not restricted to the convenience and grocery channels. In fact, the publication ‘SmartCompany’ reported that “Over 6000 independent hardware stores to close as Bunnings and Masters nail the competition” – Wednesday, 15 April 2015 Andrew Sadauskas.

Mr Rogut said that AACS does not wish to see the stranglehold by major retailers exerted over other retail sectors and that, “Those interested in real competition and the genuine interests of consumers should also want this outcome avoided which also includes suppliers to the industry who will see diminishing outlets for their products”.

“In our case, AACS has long argued for deregulation in the packaged alcohol sector – as an example –– to enable convenience stores to have the right to responsibly sell these products if they choose to, subject to normal staff training and age regulations. Consumer purchasing habits when it comes to packaged alcohol aligns perfectly with the convenience store model.

“This is just one way that the viability of our industry and its smaller franchised, or owner operated businesses may be assured of a way of competing with the majors” Mr Rogut concluded.

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top