New frontier opens in the supermarket wars

Both Woolworths and Coles have declared a war on waste, going to differing lengths to convince the public that they take their plastic packaging waste seriously. It will be interesting to see how it affects suppliers.
Coles’s 10-point plan
Coles has undertaken to halve food waste across its supermarkets by 2020, make all packaging of Coles Brand products recyclable, and reduce plastic wrapping on fruit and vegetables.
The announcement of 10 Coles Commitments on Packaging and Recycling comes as the retailer prepares its customers for the phasing out of single-use plastic bags on July 1.
Significantly, Coles also pledges to divert 90 per cent of all supermarket waste (including food, cardboard and plastic) from landfill by 2022 and donate the equivalent of 100 million meals to people in need by 2020 by redistributing surplus food.
Coles managing director John Durkan said Coles wanted to lead the way in its commitment to the environment.
“We know that 69 per cent of customers say that we need to actively reduce waste and landfill through recyclable packaging and find alternative uses for waste,” he said.
“We are delighted to be the only Australian supermarket to sell own-brand water bottles that are both 100 per cent recyclable and 100 per cent made from recycled materials. Now we are the first major food retailer in Australia to announce a target to make all of our own brand packaging recyclable by 2020, ahead of the Federal Government’s target of 2025.”
“By the end of this year we will also connect every Coles store to the vital food rescue program, SecondBite, meaning surplus edible food from every Coles supermarket will be redistributed to people in need. By connecting an additional 130 supermarkets to SecondBite this year, we will also be further diverting food waste from landfill.
“By 2020, we want to provide the equivalent of 100 million meals to Australians in need. Since 2011, we’ve donated around 72 million meals to SecondBite and Foodbank so we’ve still got 28 million meals to go.”
Coles has also pledged to label all Coles Brand products with recycling information to help customers know how and where to dispose of their waste.
Coles’ commitments to recycling and packaging also include:

  • A program to reduce plastic wrapping of fruit and vegetables through new initiatives such as removing double plastic packaging for fruit, selling bunched vegetables like kale and silver beet without plastic, and removing plastic packaging from Coles Brand bananas.
  • Replacing packaging for a wide range of meat and poultry products with packaging made from recycled and renewable materials.
  • Replacing existing single use fresh produce bags with bags which have 30% recycled content.
  • Providing customers with an option to recycle all their soft plastics at every Coles supermarkets across Australia, to then be converted into a range of products including outdoor furniture and road base.
  • Providing an additional one million reusable crates for fresh produce in our Coles supply chain in 2019 to replace single-use cardboard and polystyrene boxes, adding to the 6 million reusable plates currently being used.

…achievements to date

  • Since 2011, we’ve donated the equivalent of around 72 million meals to SecondBite and Foodbank.
  • Since September 2014, all Coles Brand water bottles made from 100% recycled PET (rPET).
  • Only Australian supermarket to have its own crate recycling program in Australia with more than 6 million reusable crates in circulation.
  • Commitment to remove single use plastic shopping bags across all Coles businesses by 1 July 2018.
  • In 2011, Coles was the first Australian supermarket to provide a soft plastic recycling program to customers across Australia through REDcycle.
  • First Australian supermarket to provide soft plastic recycling in every store.
  • More than $12 million in grants or interest-free loans to 27 different producers as part of the $50 million Nurture Fund.

…and commitments for the future

  1. Divert 90 per cent of supermarket waste (including food, cardboard and plastic) from landfill by 2022.
  2. Halve food waste in Coles supermarkets by 2020.
  3. Donate unsold edible food from every Coles supermarket in Australia.
  4. Provide the equivalent of 100 million meals to Australians in need by donating unsold, edible food.
  5. Work with suppliers to reduce food waste.
  6. All Coles Brand packaging recyclable by 2020.
  7. More recycled material in Coles brand packaging.
  8. Introduce new labelling to promote recycling.
  9. In-store soft plastic recycling options in every Coles supermarket.
  10. Reduce excess packaging across our stores and supply chain.

Phasing out the sale of plastic straws, further reductions in plastic packaging in fruit and vegetables, and the launch of a new reusable shopping bag are amongst a number of sustainability initiatives announced by the Woolworths Group.
On the eve of World Environment Day, Woolworths Group CEO Brad Banducci made the announcements at an industry sustainability event hosted at the Group’s Support Office in Bella Vista, Sydney. The new initiatives announced, include:

  • By the end of 2018, all stores within the group in Australia and New Zealand will no longer sell plastic straws – saving 134 million plastic straws from going into circulation each year.
  • With the nationwide phasing out of single-use plastic shopping bags on 20 June, Woolworths Supermarkets will offer a new green reusable shopping bag – with a lifetime replacement offer – for customers to purchase. All money made from the sale of the Bag for Good in FY19 will go towards the Junior Landcare grants program.
  • In an ongoing effort to remove unnecessary packaging in produce, Woolworths is committed to trial the removal of plastic packaging on a further 80 lines over the next year. This will build on the 140 tonnes of plastic saved in the fruit and vegetables range in the last year.
  • A commitment for 100% of Woolworths Supermarkets to have a food waste diversion partner by the end of 2018.
  • Woolworths to lead the establishment of a new Packaging Coalition Roundtable bringing together government, NGOs and key industry partners including Unilever, Nestlé, Simplot, VISY and the Australian Packaging Covenant to find ways to move towards a circular economy in Australia.

Woolworths Group CEO Brad Banducci said: “In the last year, we have seen a shift towards more sustainable attitudes from our customers and the momentum is growing, with recent research showing a 15% increase in Australians now saying that taking care of the planet is important to them.
“While we’ve made progress in reducing the amount of plastic in our stores, supported recycling labelling initiatives, and made improvements in energy efficiency, sustainable sourcing and reducing food waste, we know that more needs to be done to meet our customers’ expectations.
“Today’s initiatives represent further small, but important steps in our commitment to make positive change happen. We understand the journey towards a more sustainable future has its challenges, but together with our customers and industry partners we are committed to moving our business, our country and our planet towards a greener future.”
The sustainability event at the Woolworths Support Office also included global perspectives on sustainable retailing from Peter Skelton from WRAP UK, while Craig Reucassel from ABC’s War on Waste facilitated a panel of industry leaders discussing the challenges and opportunities of moving to a circular economy.
The panel included Angus Harris (Co-CEO Harris Farm Markets); Anthony Pratt (Executive Chairman, Visy Australia & Pratt Industries); Claire Peters (Managing Director, Woolworths Supermarkets); Clive Stiff (CEO Unilever, Australia and New Zealand) and Paul Klymenko (CEO Planet Ark Australia Foundation).

Toll, Coles sign workers' rights agreements with TWU

Toll launches global Charter in Australia  
Following Toll’s agreement with the global union ITF (Workers are valued: Toll signs worldwide union agreement), a global Charter ensuring safe and fair working standards across Toll Group’s global network has been launched in Australia.
The Charter will cover all Toll employees across its 1,200 sites in 50 countries, follows negotiations between Toll, the Transport Workers’ Union, the International Transport Workers’ Federation (ITF) and its other affiliated unions.
Through the Charter, launched at TWU National Council in Adelaide, Toll has committed to abide by international labour standards. The ‘global charter of principles’ outlines guiding principles by which crucial decisions will be made around the working conditions for Toll workers focusing on health and safety standards, business strategies and initiatives, improvements in working conditions in developing countries and the development of projects that increase industry standards and safety.
Under the charter, Toll, which represents 44,000 workers in road transport and distribution, logistics, supply chain and warehousing, has committed to making a significant investment in the development and implementation of a global project that will raise standards and safety in its main sectors.
Coles & TWU sign agreement to ensure safety and fairness in the Coles supply chain and on-demand economy 
Coles and the TWU have signed two important statements of principles that will ensure safe and fair conditions for workers in the Coles supply chain and the on-demand economy.
The first statement, signed at TWU National Council in Adelaide by Coles managing director John Durkan and TWU National Secretary Tony Sheldon, includes five principles to ensure safety and fairness for transport workers within the Coles supply chain.
These principles include: the ongoing promotion of safety and fairness; transparency on supply chain information; ensuring workers are treated fairly and have the right opportunity to contribute to a collective voice; education, training and consultation of workers on safety, and initiatives to ensure safety in the industry more broadly. The five principles will underpin a Charter between Coles and the TWU.
A separate Statement of Principles about workers in the on-demand economy recognises that workers in the on-demand economy are involved in a rapidly changing workplace environment, but this doesn’t mean artificial terms for workers should limit their access to appropriate entitlements such as leave, proper payment, superannuation, safe working conditions and representation.
“This is a major positive for all transport workers – whether in traditional industries or the on-demand economy. Coles and the TWU are saying through these principles that there is no higher priority than safety and fairness in the Coles supply chain and the on-demand economy,” said TWU national secretary Tony Sheldon.
“This indicates to the community what can be achieved with good corporate citizens on board,” he added.
Coles managing director John Durkan said: “Our business, and the businesses of our thousands of Australian suppliers, rely on the skill and the efforts of the workers in our supply chain. As our business evolves to meet the constantly-changing needs of our customers, we are also increasingly engaged with the on-demand economy.
“The people who work in these sectors make an invaluable contribution not just economically, but to the community as a whole. We are proud to make this commitment that their safety and fair treatment will always be a top priority for Coles.”

MaxiTRANS celebrates record contract with Coles

MaxiTRANS has secured one of the nation’s largest ever contracts of its kind by signing an agreement to supply 395 Maxi-CUBE and Freighter trailers to Coles Supermarkets in New South Wales and Western Australia.
After much speculation in the marketplace, the company made the outcome of the $60 million agreement public on 4 April on the back of a factory visit by the Hon Wade Noonan MP, Minister for Industry and Employment and Minister for Resources, and Coles’ Head of Transport, Tony O’Toole.
MaxiTRANS’ new Managing Director and CEO, Dean Jenkins, used the opportunity to commend Coles on its commitment to local manufacturing. “We are proud that Coles has chosen to partner with MaxiTRANS,” he said. “This is a tremendous show of support by Coles in Australian regional manufacturing.”
Coles’ Head of Transport, Tony O’Toole, commented on the importance of MaxiTRANS’ local footprint for the outcome of the contract. “Coles is pleased to be able to support the creation of jobs in regional Victoria through this partnership with MaxiTRANS,” he said.
“We are always looking for ways to strengthen our relationships with local suppliers to help sustain the communities we serve every day, and we’re proud that deliveries to our stores will be made using trailers produced right here in Victoria.”

Coles supermarket improves payment system for suppliers

Coles will reduce the payment times for its suppliers from an average of 30 days to within 14 days from July, the supermarket recently reported.
The move comes ahead of a report from Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell set to reveal the payment times of the nation’s major corporations, due to be released in the coming weeks.
John Durkan, Managing Director, Coles said that payment times will be reduced for the more than 1,000 suppliers that provide the supermarket with up to $1 million in merchandise each year, specifically those issuing electronic invoices.
“We understand how important cash flow is for small suppliers and shortening payment times will help to make it easier for them to run their business,” he said.
Carnell has reported ahead of the release of the report that payment times have become worse over the past 12 months, and large multi-national companies are the worst offenders.
“In fact, some large companies have moved payment terms to as long as 120 days,” she added.
Carnell added that Coles’ decision will benefit hundreds of small businesses.
A spokesman for Coles told Inside Retail that the supermarket’s movement towards shorter payment times did not come about due to the ombudsman’s report, rather it was part of its ongoing work to improve its relations with suppliers.

Truckies disrupt Coles Distribution Centres to highlight retailer's lethal squeeze

TWU NSW Secretary Michael Aird has told Coles to stop buying off their responsibilities as major transport clients by donating to politicians in Canberra and instead take responsibility for their lethal economic squeeze on truck drivers that is leading to hundreds of truck crash related deaths on Australian roads each year.

Mr Aird was speaking after a convoy of trucks and more than 100 transport workers disrupted Coles' two largest Distribution Centres in Sydney at Smeaton Grange and Eastern Creek. Candidate for the Federal electorate of Banks Chris Gambian also signed a pledge refusing to accept any donations from Coles or Wesfarmers until they put commodity safety ahead of corporate bonuses.

"We acknowledge that some members of the community were affected by this action, but mothers, fathers, sons and daughters are being killed on our roads and we need bring to attention the scale of the crisis," Mr Aird said.

"Money that should be going to truck drivers to help them maintain their vehicles and sustain their families is instead going into the pockets of the Coles Managing Director and his senior executives as bonuses for driving down transport costs and making our roads unsafe.

"This is leading to chaos and tragedy on our roads and in our commodities, with hundreds of fatal truck crashes each year."

Mr Aird said Coles' attempts to avoid their responsibilities have extended to multimillion dollar lobbying operations in Canberra, with $2.1 million donated to the Liberal Party in recent years and an extensive backroom lobbying presence.

"This is a company that chooses to spend millions lobbying in Canberra to abolish laws designed to save lives rather than step up and acknowledge their responsibility to our community. This is the ultimate example of the big-end of town thinking they can buy their way out of any problem," Mr Aird said.

"We are proud that politicians like Chris Gambian are willing to stand with their communities and transport workers by pledging not to take any donations from Coles of Wesfarmers until Coles puts community safety ahead of their profits and executive bonuses."

Chris Gambian said, "Safe rates should be a bipartisan issue: it is important for our truck drivers, their families, and every Australian family that we have safe roads. I call on all candidates in the seat of Banks to make this same pledge."

Truck driver Mark Smallwood said that truck drivers were under immense pressure to push the limits on fatigue, speed and truck maintenance because of the lethal squeeze by companies like Coles.

"The pressure is very real because often it's the difference between keeping a contract and not being able to feed your kids," Mr Smallwood said.

"Truck drivers shouldn't have to risk their lives, and the lives of others on the road, to meet Coles' impossible demands.

"I'm lucky enough to work for a decent company but I know I share the road with hundreds of drivers who are exhausted, overloaded and speeding. This is what leads to crashes."

Mr Aird said that March had been a horror month on Australian roads.

"Already this month, 20 people have been killed in truck crashes across Australia -that's 20 people who will never come home to their families, friends and communities," Mr Aird said.

"If we are serious about ending this carnage then we need to tackle the root cause of the crashes: relentless pressure from clients forcing drivers to speed, drive long hours and delay essential maintenance."


Coles drivers to receive fair wages

Coles has been pressured by the Road Safety Remuneration to pay their fair share to ensure safe rates for drivers includes provisions for auditing industry supply chains in the final Tribunal ruling on driver rates.

According to TWU National Secretary Michael Kaine, evidence provided by transport operators showed industry clients, like Coles, are increasing economic pressure on operators and drivers by seeking reductions in the amount paid for transport work.

“Holding clients to account for paying enough to operators so all drivers can be paid safely is a vital part of making sure our industry is safer and fairer. Strong auditing provisions will ensure drivers are paid the correct rate for their work,” Kaine said.

Minimum rates for time spent waiting and queuing at distribution centres will be affected by the Tribunal, as drivers are required to be paid for loading and unloading time in addition to servicing and repairing trucks and trailers.

Transport operators admitted in evidence to the Tribunal that economic pressure in the industry would ease if clients were required under the Order to pay sufficient amounts to ensure drivers are paid according to the rates model.

40 million-dollar Woolworths contract

Australia’s largest retailer, Woolworths, has awarded a $40 million supply contract to the Glen Cameron Group, a privately-owned transport and logistics company.
Camerons will be responsible for the delivery of goods and produce to Woolworths supermarkets and liquor outlets in South Australia for the next five years, starting 18 May.
Woolworths operates about 53 supermarkets and 64 free-standing liquor outlets in the region and Glen Cameron Group will manage about 850 store visits each week, delivering more than 10,000 pallets of stock.
The contract will be serviced by a management team of five full-time Cameron’s staff and 43 transport workers. Employment opportunities for drivers and support staff will rise during peak delivery times. 
Cameron’s managing director Glen Cameron said the Woolworths contract win was a “testament to our team, our fleet and our service offering”.
“Woolworths has a requirement for a modern, green and clean fleet,” Mr Cameron said. “Driver safety and our ability to meet demanding delivery schedules were crucial to our contract win.”
Glen Cameron launched Camerons in 1975 with a first-year turnover of $160,000. At 22 years old he was the sole employee and his fleet consisted of one, eight-tonne tray, which was owned by a subcontractor.
Today the Glen Cameron Group employs 600 people, has a turnover in excess of $115 million, operates a national fleet of more than 520 vehicles and offers its customers a national logistics operation with more than 70,000 square metres of warehouse space.
Glen Cameron Group has office locations in all Australian states. The business operates five major divisions: local trucking, couriers, warehousing, third party logistics and interstate transport.
In 2006, Glen Cameron Group was awarded a contract to supply Coles supermarkets throughout Victoria and southern New South Wales with frozen and chilled product and has successfully managed this operation to Coles satisfaction.

Coles COO to head up supply chain

Mick McMahon Coles COO supply chain

Mick McMahon, currently chief operating officer of Coles, will take up an old/new senior position after Ian McLeod starts later this month as managing director of the Coles division of Wesfarmers.

As director – Liquor, Express and Supply Chain, Mr McMahon will be responsible to Ian McLeod for the division’s liquor, fuel and convenience store businesses (Coles Express) and the supply chain function across supermarkets, liquor and Express.

Wesfarmers managing director Richard Goyder said Mick McMahon had made a great contribution in the five months since Coles was acquired.

“I am very pleased Mick will continue to play a central role in the Coles operations,” he said. “With Terry Bowen as finance director and John Durkan as merchandise director, plus others yet to be appointed, Ian McLeod will have the high quality team he needs to lead and transform the Coles business.”

Transport unions, don’t blame us: Woolworths

While the trucking industry continues to attack major retailers arguing they are refusing to pay fuel levies to drivers, Woolworths has said the industry is wrongfully placing the blame on the company.

Following a union-led protest staged at Rosehill, Woolworth has issued a statement saying the Transport Workers Union (TWU)’s claim against the company was “unfounded”.

“Contrary to TWU spin, Woolworths pay appropriate national fuel levies to all its transport providers and these are reviewed on a regular basis,” it said.

“Woolworths understands that there is genuine hardship across the transport industry and it is our expectation, and our transport providers’ responsibility, that these fuel levies are passed onto any drivers who are subcontracted by our direct transport providers.”

TWU has previously stated the major retailers like Coles and Woolworths increase the costs of goods using the rising fuel costs as an excuse, yet the levy is not passed down the transport chain to the drivers.

Woolworths added it recently wrote to its major transport providers requesting their assurance that they treat their subcontractors fairly regarding the issue.

It said while the company’s transport costs have soared, its extensive management strategy has enabled it to keep the food price inflation level at 2.9 per cent, below the national figure of around four per cent.

“As a company that depends on transport, Woolworths accepts that higher fuel prices are a fact of life and is investing heavily in more efficient technologies and trialling alternative fuels.

“Innovation and best practice leadership in transport are the direct result of investments made by major businesses such as Woolworths.”

The company said the industry needs to stop playing the blame game over fuel prices, and start to collaborate.

“All sectors of the logistics industry must work together to ensure that we can meet the challenges ahead rather than unfairly placing blame on selected participants,” it said.

Toll takes to Somerton

The Somerton Logistics Centre.

The Somerton Logistics Centre.

Toll Holdings is set to become the anchor tenant of the $135 million Somerton Logistics Centre (SLC) in Melbourne.

The transport and logistics giant has signed a short-term lease contract with the centre at an annual cost of $1.7 million. Under the contract, which is one of the largest leases in the region this year, the company will rent units 1 and 2 on the property, reportedly to service Coles supermarkets.

The SLC, one of the biggest industrial property projects in Australia, occupies an area of around 125,000 sqm featuring eight warehouses.

SLC director Nigel Hunt said it was the second time that the centre worked with Toll and its anchoring at the site would have a positive impact on prospective tenants. 

“Having a big name gives other tenants confidence, and it also puts us in an active position in the industrial property sector. There’s nothing negative about it,” Mr Hunt said.

The Somerton Logistics Centre.

The 22-hectare site sits on the corner of Cooper Street and Hume Freeway, and has direct access to Melbourne’s airports and ports. 

Mr Hunt said there were three or four potential businesses currently negotiating lease agreements with the centre.

He said the centre had a small management team who could directly interact with tenants, which enabled it to provide properties at a cheaper price.

“We don’t charge for administration or management services, which results in a cost saving of $7-9 per sqm. When you think about the size of the space that they use, that’s a significant amount of saving,” he said. 

Toll’s contract with the SLC follows the announcement that it had rented a 27,000 sqm site at ING Industrial Fund’s warehouse facility in Sydney. 

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