Consumer advocacy group Choice has found the price of some whitegoods, such as freezers and fridges, soared as Australians stocked up on food at the height of the coronavirus pandemic.
- A Choice survey found at least one in three Australians faced price hikes for essential products in March
- The consumer group also found the prices of fridges and freezers rose during that period
- Choice is calling for state governments to review their consumer laws in light of its findings
According to the research, the price of a Westinghouse chest freezer at Billy Guyatts went up by 63 per cent — from $916 in October 2019 to $1,490 March 2020.
At other stores, a small Esatto freezer went from $327 last year to $499 at Appliances Online in February this year, and a Siemens freezer rose from $2,085 in October to $2,850 at Winnings Appliances in March.
The prices were set by individual retailers and not by the products’ wholesalers.
Amy Pereira from Choice said the demand for freezers and fridges increased as consumers rushed to supermarkets amid confusion over potential lockdowns.
“As a result, we did see that some businesses responded to this by hiking their prices.”
But one of the owners of retailer Billy Guyatts, Mark Caval said the company did not hike its prices because of the pandemic.
“Billy Guyatts is a small family-run business,” he said.
“We did not increase our prices in response to the pandemic lockdown, because we did not know there was going to be a lockdown.
“Our pricing is dynamic and changes daily according to supply in the market, and what our competitors are offering.”
But Ms Pereira said the group had spoken to supply chain experts who could not justify why prices had risen so high.
“It’s vital that we look at what happened during this crisis and put protections in place to make sure Australians don’t get exploited again — whether that be through price gouging or panic marketing,” she said.
The Winning Group said prices at Appliances Online and Winning Appliances were not set manually, but determined by an algorithm.
In a statement, the chief executive of Winning Group, John Winning, said none of the factors that influenced pricing, such as manufacturing costs or exchange rates, had changed during the pandemic.
He rejected any allegation the companies increased their prices in response to the situation.
“We have not engaged in any form of price gouging and any suggestion that we had would be incorrect,” he said.
‘Essential prices did rise’
In March, as the pandemic intensified, supermarket shelves were emptied of essentials as shoppers stocked up.
The situation got so bad that Australia’s competition watchdog, the ACCC, decided to allow supermarkets to work together to ensure shoppers could access food items at a fair price.
A survey of 1,000 people conducted by the consumer advocacy group from March 20 to March 29, also found at least one in three Australians faced price hikes for essential products.
“We saw across the board that prices for essential goods did rise,” she said.
“We were particularly concerned … about the price rises for personal protective equipment like facemasks, hand sanitizer, soap and other essential items like toilet paper.”
Products like toilet paper were in such high demand in March that physical altercations broke out in aisles as supermarkets imposed limits per customer.
In Western Australia, 45 per cent of respondents reported higher prices during that period, with 44 per cent reporting the same in the Northern Territory, South Australia, the Australian Capital Territory and Tasmania.
“There are explanations like supply chains or shortages but we’re really concerned about those instances where it can’t be explained, where there is no reasonable explanation for increasing the prices exponentially,” she said.
The group is calling on states to review and strengthen consumer protection laws in light of the findings.
“Choice has investigated business behaviour over this period and we’ve seen some inexcusable opportunism, panic marketing and price gouging from retailers across the country.”