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Independent operators dodge supply problems stripping supermarket chains’ shelves

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While Australia’s major supermarket chains battle to cope with stock shortages and bare shelves, it’s business as usual for independent grocers and retailers.

Jason Cooper, CEO of Fresh State, represents wholesalers at the Melbourne Markets and says the pandemic has provided a win for independent players and lessons for major retailers.

“The independent retailers predominantly get their produce out of the central market system … and we don’t have supply issues,” he says.

“For whatever reasons there are different distribution processes within the industry.

“Was it through good luck or good management? I don’t know but certainly the pandemic has shown up some challenges for (the supermarkets) and it’s probably something they need to go back and consider for the future.”

More than 5000 businesses including independent greengrocers and supermarkets buy from produce markets for distribution across Victoria and Australia.

Cooper says with a bigger pool to choose from, any shortages can usually be covered by another grower.

“We have a different distribution model, we’re not reliant on one particular system or one group of employees,” he says.

“Effectively there are 500 independent businesses that operate out of the Melbourne markets.

Minimising the risk

“Because you’ve got a couple of thousand retailers that come in, it minimises the risk to the supply chain because once they’ve bought the produce they’re putting it on their own trucks and taking it out to their stores.”

The spread of the virus and isolation of many workers has seen shelves empty at big supermarkets along the east coast in recent weeks.

National cabinet this week agreed to relax close contact isolation rules in a bid to resolve the growing crisis.

It’s a similar story at the Sydney Markets, according to wholesale agent Shaun McInerney.

More than 700 businesses operate stalls and their customers include the independent supermarkets.

“The product still goes in and out every day and that’s why the independents have been able to keep their shelves full,” he tells AAP.

“Some of the major retailers would have struggled because … a lot of the eggs are in one basket, there are only a limited number of people who supply to them directly.”

Retail diversity

McInerney, who also sits on the Sydney Markets board, says local independent stores have still been getting the produce they need, although he concedes prices can be higher.

“Shopping at your independents is vital to keep diversity in retail which equals diversity in the growing base” he says.

One wholesaler whose customer base also includes Australia’s major retailers, says the big players need to take stock in the wake of their supply chain woes.

The wholesaler, who prefers to remain anonymous, had their order cut back 40 per cent by Woolworths in the week after Christmas.

“In the wholesale market, encouraging and supporting independent retailers is crucial,” they say.

“The bigger retailers might take a lesson from that in having a little more diversity in their supply chain rather than keeping it as efficient and low cost as they can through less distribution centres.”

-with AAP

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