Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Woolworths (ASX:WOW) Battles Nestle, WOW Share Price To Fall?

The Woolworths Group Ltd (ASX: WOW) and Coles Group Limited (ASX: COL) share prices could be worth watching as they battle international suppliers.

Woolworths and Coles are Australia’s two largest supermarkets with national networks of grocery stores and distribution centres. Woolworths Group also operates Big W, Dan Murphy’s and BWS. Coles operates Liquorland, First Choice Liquor and Vintage Cellars.

What’s Going On With Woolworths And Coles?

According to Australian Financial Review reported, the two supermarket giants are calling international suppliers’ bluff by not sanctioning price rises because of higher commodity costs.

Global food giant Nestle has supposedly halted supplying Uncle Tobys oats to Woolworths because the supermarket wouldn’t increase prices by 6%.

Pet food giant Mars Petcare has stopped supplying Coles and Woolworths with Whiskas, Pedigree, My Dog and Dine, also due to a lack of price increases.

The AFR quoted a Nestle spokesman who commented, “We have a supply issue with Woolworths which we’re both working hard to resolve to make sure that they are available there soon.

In response to the reports, Woolworths and Coles said there were product shortages but expects the products to be back on the shelves soon.

The supermarket duopoly has long been accused of treating suppliers unfairly, although no-one is accusing the supermarkets of that yet.

Woolworths and Coles are trying to keep prices as low as possible because competitors like Aldi and Costco are offering products for even lower prices.

Even so, both of them are reporting that product prices, excluding tobacco, are falling by around 2% on the shelves.

Rising costs and fixed revenue for suppliers is not an acceptable position over the long term. Nestle wants to increase prices because the drought has led to wheat and barley prices doubling over the past couple of years and milk prices have also increased with lower milk production.

I think it can be a dangerous idea to invest in businesses that are struggling to raise prices with few alternative avenues for growth.

At the moment I would put Woolworths closer to a sell than a buy if it were in my portfolio. Instead, I would rather invest in one of the reliable and proven businesses in the free report below.

[ls_content_block id=”14945″ para=”paragraphs”]

[ls_content_block id=”18380″ para=”paragraphs”]

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Skip to content