Overview
- Coles reported slower first‑quarter growth with group sales up 2.2% and supermarket revenue up 3.6%, and its shares fell about 10% after the company warned of flat first‑half supermarket profits.
- Woolworths disclosed stronger first‑quarter momentum with total sales up 4.7% and Australian food sales up 6.9%, and its CEO warned many families will cut back this Christmas.
- Both chains say shoppers are trading down, hunting promotions and using loyalty schemes, so each is stepping up budget ranges, price guarantees and targeted promotions to win value‑focused customers.
- Retail margins face pressure from food cost rises in dairy and meat, easing deflation in fresh produce, and volatile fuel prices that are lifting transport and operating costs.
- For households that pay a mortgage, groceries can account for roughly 10% of spending so tighter budgets this season could push more meal planning, earlier shopping and sharper competition on price through Christmas.