Supermarket giant Coles has confirmed an emerging trend of shoplifting across the country, as inflated prices push more people to take desperate action.
On Tuesday, the retailer posted a $1.1bn net profit for the 12 months to June 2023, up 4.8 per cent on its 2021-22 profit result.
Despite consumers feeling the pinch, revenue from sales also continued to climb by 5.2 per cent to a staggering $41.83bn.
It seems the pressure of inflated prices both inside the supermarket and out are starting to take their toll on everyday Australians, with the retailer revealing theft rates have surged in stores across the country.
Coles chief operating officer Matt Swindells said stock loss was up by 20 per cent.
“It’s everything from organised crime, people stealing things and putting them on marketplaces online, to a wider range of opportunistic or petty theft” he told 3AW radio station on Wednesday.
“We are seeing it in every store and every category, it’s a real challenge.”
He admitted part of the problem can be attributed to the cost-of-living crisis putting pressure on the weekly budget.
To combat the issue, the supermarket has promised to bolster its security guard team and install new age smart gates with technology that can tell if someone is leaving the store without paying.
Coles’ management told analysts on a call on Tuesday that the company was investing in a variety of methods to combat this, including having more security guards, rolling out smart gates that stop consumers from exiting a store without paying, and implementing trolley locks, which prevent shoppers from filling a trolley and then leaving the store.
Supermarket boasts $1.1bn profit
Supermarket sales drove the overwhelming majority of Coles sales revenue reaching $36.75bn last financial year, up 6.1 per cent year-on-year.
The results are an improvement on the Coles Group’s’ strong first-half earnings, posted in January, which revealed an increase in its net profit after tax by 17.1 per cent to $643m.
Coles also sold off its branded service station network to Viva Energy in September last year for $300M.
The fresh profit figures come as consumers continue to grapple with unrelenting inflationary pressures, with price increases for products in the nation’s shopping trolleys outpacing the broader inflation rate.
“Of course, the most significant issue for customers in cost of living. We know from our research that our customers are becoming more value conscious. We’ve been worried about their ability to cover costs, particularly young families,” Coles Group chief executive Leah Weckert said.
However, Ms Weckert also pointed to easing supply chain and price pressures across the supermarket’s inventory, meaning consumers could expect to experience falling prices.
“We’ve got a lot more consistency in terms of the availability of products that is coming through from the suppliers,” she said.
“We actually do have a number of areas that are nowadays in deflation … and that’s driven by vegetables and then red meat.”
While Australia’s inflation rate cooled to 6 per cent in the 12 months to the June quarter, households are still feeling pain at the checkout, with food prices continuing to surge, up 7.5 per cent, according to recent ABS data.
Dairy products have led the price increases, up more than 15 per cent, followed by breads and cereals, up nearly 12 per cent. Processed foods like coffee and tea are up more than 11 per cent.
In recent months, Coles and other major supermarkets have faced accusations of price gouging – a situation whereby increases in the final price of products and services outpace any additional increase in input costs.
Former competition tsar Rod Sims, who previously led the Australian Competition and Consumer Commission, claimed that Australia’s major supermarkets appeared to be taking advantage of limited competition in the sector to increase prices higher than necessary.
But the major supermarkets, Coles and Woolworths, have cited improved productivity and cost efficiencies, rather than profiteering, as the reason behind their increased profit margins.
Both chains separately claimed to a parliamentary inquiry launched earlier this year that their suppliers continued to increase costs, which in turn was increasing final prices for consumers.
The final dividend climbed to 30c a share, taking total dividends for the 2022-23 financial year to 66c.
Despite the profit result, Coles’ share price fell 5.6 per cent to $16.26 when the ASX opened on Tuesday.
Woolworths, Australia’s largest supermarket retailer, is set to post its 2023 financial year profit result on Wednesday.