The Fairness principle relates to supermarkets engaging in free and fair competition, dealing with all parties fairly and equitably, and practice non-discrimination in employment and contracting. (Paine 2006). Major supermarkets violate the fairness principle during the exchange of milk with farmers. Pressure is put on our Aussie farmers to sell milk at a “close-to-cost” price creating a low profit for our farmers. Large Supermarkets such as Woolworths and Coles have the buying power to threaten farmers by threating to purchase from competitors and even sell private label milk from processors. Farmers are then forced to sell milk at low costs in order to maintain a decent livelihood, with little to no intervention by the government to help our farmers.
Three years after Coles and Woolworths introduced $1 milk Australia wide; Dairy Farmers (a large Australian milk company) is still producing milk at a loss in which margins have been crunched by the aggressive price cuts of the major supermarkets. In the past 4 years the price of milk has gone up 15c, but the price supermarkets are willing to pay has went down by 7c. This shows the overpowered authority supermarkets have, ultimately hurting the farmers who have no influence on the price of milk. This pressure is often exerted to milk companies such as Dairy Farmers who have no choice but to sell at a low price due to cheap processed milk being sold for pennies by the big supermarkets.
Many ways have been recommended to combat this issue, but government intervention will implement fairness through enforcing stricter guidelines to large supermarkets, including paying farmers a minimum percentage over cost price, helping milk and even fruit and vegetables processing stay in Australia.
The Transparency principle relates to supermarkets conducting business in a truthful and open manner, refraining from deceptive acts and deals with suppliers and partners honestly. (Paine)
Transparency principle is broken in many ways by large supermarkets such as Coles and Woolworths. Examples include misleading advertisement and false information in which these supermarkets are guilty of in many circumstances. Us as consumers have the right to know where products are made from, and even when they were made, but do we really believe everything supermarkets say? Supermarkets are professional deceptions making full use of loopholes in Fairtrade practices creating unethical and un-transparent procedures.
For many years now Coles has been selling bread under the deception of “Baked Today” and “Sold Today” with the word Fresh commonly sighted throughout the bread section. Consumers have been unfairly misled, as in some cases bread was baked months earlier in overseas factories. Even Woolworths, “The Fresh Food People” with the deception of their fruit and vegetables being fresh. A study showed fruit such as peaches are picked early, and then put in dark rooms and stored for months to slowly ripen and when it is in your kitchen, as Joseph Aiello says, “The peach almost forgot it’s a peach”. Also, the deception of products being made in Australia, or was a minor ingredient of a much larger product grown in Australia? These and many more key deceptions used by supermarkets to trick consumers.
Stricter regulations on supermarkets by the ACCC who condone against transparency principle such as misleading advertising and misleading claims should commence.
The dignity principle relates to supermarkets respecting the dignity of all people,