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RNZ News
12-05-2025
- Business
- RNZ News
Bunnings boasts about its price-beating guarantee but for 9000 products in Australia there is a catch
By Angus Grigg , the Business Reporting Team's Emilia Terzon , Elise Potaka and Ben Schneiders , ABC A Citeco ladder with a sign that says" "Where you find a competitor's lower price on the same in-stock item we'll beat it by 10%." Photo: ABC Four Corners It's the Bunnings slogan everyone's heard - a promise to beat a competitor's price on the same stocked item by 10 per cent. But there's a catch to the hardware giant's famous price guarantee. While Coles and Woolworths have been under intense scrutiny, Bunnings - which has a much higher profit margin than either of them - has mostly escaped attention. With its massive reach, how Bunnings sets prices and competes matters to millions of Australians. But are customers actually getting the deal they think they are? Say you wanted to buy a ladder. A Citeco 0.9-metre, three-step Industrial platform ladder. Photo: ABC Four Corners / Nick Wiggins On TV, Bunnings advertised a Citeco 0.9-metre, three-step ladder alongside its promise: "Where you find a competitor's lower price on the same stocked item, we'll beat it by 10 per cent." In-store, a 0.9m Citeco ladder sits behind a large red sign with the same commitment: Find a competitor with the same in-stock item - 10 per cent off. But there is no competitor that stocks the Citeco 0.9m ladder. That's because Citeco is a Bunnings home brand. Not only is it manufactured for Bunnings, the hardware giant also owns the Citeco trademark. It's far from the only item. Through the trademark register and questions to Bunnings, Four Corners has found the hardware giant has more than 9000 home-brand products. In Bunnings aisles around the country, many of these home-brand products are sold alongside signs with its 10 per cent promise. Products like a Jumbuck spit roaster or a Trojan rake, a Bastion roof vent or an Eśtilo toilet - even a Bunnings bucket. If you can find these Bunnings buckets cheaper elsewhere, Bunnings says it will beat the price. Photo: ABC Four Corners You can't find these products cheaper anywhere else because they're made for Bunnings. "I think it's misleading," says John Dahlsen, a competition lawyer and former chairman of Woolworths, who now chairs his family's hardware store and building business. "The 10 per cent beat thing is illusionary," he says. Working out what is a Bunnings home brand isn't simple. Its ownership of Citeco (the brand behind the ladder) isn't clearly disclosed on the packaging, the products themselves or in-store. And on the Bunnings website they are sold like any other brands. You have to search Australia's trade mark register or read parent company Wesfarmers' annual report before Bunnings's ownership becomes apparent. Bunnings's brands include everything from Jumbuck barbecues and Craftright toolboxes to Marquee outdoor furniture, Mondella toilets and Happy Tails pet supplies. Some home brands, such as Trojan tools, even have their own website. Competition regulator, the ACCC, told Four Corners retailers were not legally required to identify home-brand products but, if an item was marketed as though it was produced by a third party, it might amount to misleading or deceptive conduct. Bunnings says it complies with all legal and regulatory requirements for product labelling. The company says it "empowers" staff to take a "common sense approach" and will price match on similar items. It makes no mention of this in the "Price policy" on its website. "We reduce prices on our exclusive products to respond to competition in the market if the similarities of the relevant product are strong," Bunnings told a Senate inquiry last year. For John Dahlsen, that's a meagre promise and one that is highly subjective. He says if a consumer was to find a similar item, which is not always easy, and then is successful in convincing a Bunnings staff member to apply the price guarantee, then the hardware giant still only has to reduce the price on one item. Matt Steen, from consumer advocacy group Choice, says Bunnings should be more transparent about how shoppers can realistically get its 10 per cent price guarantee. "Incorporation of some kind of labelling [that it is a home brand] into their packaging and products would be really useful," he says. Bunnings said it uses "a mix of owned brands and exclusive brands to differentiate our offer and give customers choice". Branding expert Camey O'Keefe says she believes the price guarantee is more about Bunnings wanting to shape customers' perceptions. "What I think it does do is add a layer of reassurance that perhaps subconsciously people are like, 'Oh, I can trust that Bunnings will offer me the best price in the market for any given product.'" Building big profits Bunnings's ability to promote itself as the cheapest has helped the hardware giant grow rapidly over the past 25 years. In 2000-01, Bunnings had 47 stores generating sales of $1.4 billion. In 2025, the Bunnings Group has 310 stores under its famed hardware brand in Australia, plus other chains such as Tool Kit Depot and Beaumont Tiles. Together, they bring in almost $19 billion in revenue a year for its parent company, ASX-listed Wesfarmers. And while the big two supermarkets, Coles and Woolworths, have been criticised for being among the most profitable in the world, their margins are dwarfed by Bunnings's. Bunnings has a profit margin of 16.8 per cent, compared to 9.9 per cent for Woolworths and 8.9 per cent for Coles. Politicians have talked tough on supermarkets. The prime minister promised to make price gouging illegal. The Coalition wanted to go even further and break up the duopoly. On Bunnings, though, Treasurer Jim Chalmers is hedging his bets. "I'm aware that people have raised concerns about Bunnings," he said. "Our primary focus is supermarkets, but we've given the ACCC the resources that they need and the ability to recommend to us a broader focus, if that's warranted." Sydney University's Clinton Free did his doctorate at Oxford University on market power. He says while there's been great attention on the supermarkets, Bunnings has flown under the radar. "Having a very trusted brand, having a CEO without an enormous public profile, it meant that it's not been subject to scrutiny in the same way that, for example, Coles and Woolworths have." Bunnings's healthy margins have led some to question just how cheap it really can be and if a lack of competition helps it control prices. Lowest prices? Bunnings's rivals claim that despite its size and buying power, the big box retailer is not much cheaper. There's no data to independently verify this claim, so Four Corners ran its own limited survey over 95 basic hardware items. It's a rough basket of goods, and by no means a complete analysis, but what we found surprised us. The difference between Bunnings and its local rivals is literally small change. When we compared: "The savings barely cover a snag. Given Bunnings's towering market share, buying power, ruthless supplier negotiations, and healthy margins, 'lowest prices are just the beginning' looks more like marketing spin than a meaningful promise," Professor Free says. But just how much "market power" Bunnings has is difficult to pin down. The company claims its market share is just 17 per cent. This figure is impossible to verify as Bunnings won't release detailed data. It's able to claim to have such a small share of the market because it says it competes against almost every major retailer in the country. Bunnings says its rivals include Coles, Woolworths, Kmart, Myer, JB Hi-Fi, Amazon, eBay, Kogan, PetStock, Petbarn and Aldi. It even lists Spotlight, which is best known for selling fabric, curtains, and craft supplies. Market-research firm IBISWorld puts the retail hardware market share of Bunnings's parent company Wesfarmers at 33 per cent, while noting it's "far and away the leading player in the hardware retailing space". John Dahlsen claims its market power is closer to 70 per cent - a figure Bunnings disputes. That would be equivalent to Coles and Woolworths combined. Dahlsen says while the Australian supermarket sector is often criticised for its lack of competition, cashed-up international players such as Costco and Aldi are at least present in the market. For the hardware sector, he says, Bunnings has no such rivals. "To be brutal, I think they [Bunnings] are a quasi-monopoly," he says. Professor Free says when one company comes to dominate a market, consumers suffer. "A company with 30 per cent market share exercises substantial market power. At 60 or 70 per cent market share, you can dictate prices, you can dominate suppliers, and you can really repel new entrants and make it very difficult for others to compete," he says. Bunnings said in a statement that it was committed to delivering low prices. "Bunnings is also committed to working with suppliers and taking a rational approach to volume and price fluctuations, in order to support suppliers and their costs," it said. "We make significant investments in training our team members and operating our business to deliver lowest prices to our customers." - ABC Four Corners investigation
ABC News
12-05-2025
- Business
- ABC News
Hammered: Inside the Bunnings Machine
"Hammered — inside the Bunnings machine" 12 May, 2025 Four Corners ANGUS GRIGG, REPORTER: It's Australia's most trusted brand, a hardware giant that has come to epitomise our love of gardening, tinkering and home improvement. JOHN DAHSLEN, CHAIRMAN, DAHLSENS: Bunnings is a brilliant business model. CAMEY O'KEEFE, BRANDING EXPERT: They do a really good job of feeling super approachable. BUNNINGS TVC: At Bunnings we work hard to bring you the lowest prices every day. ANGUS GRIGG, REPORTER: But behind the folksy staff, aprons and catchy jingle is a corporate titan with the power to set prices, crush competitors and dominate suppliers. KAREN BROCK, BROCKLANDS NURSERY: We were slaves to Bunnings. We were like a mouse running around the hamster wheel. PETER SMITH, BOOMAROO NURSERY: It's left me feeling drained and like I'm insane they belittle you GEORGE MINGIN, KOOKABURRA WORM FARMS: There was never any respect. They never said thank you for anything. PROFESSOR CLINTON FREE, UNIVERSITY OF SYDNEY BUSINESS SCHOOL: It's sausage sizzles and face paint on the surface, but real dominance underneath. ANGUS GRIGG, REPORTER: They've sold themselves on having the lowest prices and being on the side of you, the consumer. ANGUS GRIGG, REPORTER: Hey there, just wondering what you sell this for? ANGUS GRIGG, REPORTER: But we investigate who pays when one player has too much power. JOHN DAHLSEN, CHAIRMAN, DAHLSENS: We are at Bunning's mercy. ANGUS GRIGG, REPORTER: Now a whistleblower is taking the hardware giant to court. He's not alone. ANGUS GRIGG: How does it feel coming back and seeing it all locked up? TERRY BIRBILIS, FORMER SUPPLIER: Heartbreaking. Genuinely heartbreaking. ANGUS GRIGG, REPORTER: While the supermarket duopoly has come under intense scrutiny, Bunnings has been largely ignored. DAVID WOODMAN, MITRE 10 OWNER: Hardware is heading exactly the same direction as the supermarkets. Only worse. ANGUS GRIGG, REPORTER: Bunnings insists it's committed to value, service and fairness. The new government has big decisions to make. TREASURER JIM CHALMERS: I'm aware that people have raised concerns about Bunnings… ANGUS GRIGG: If Bunnings asked you to come back what would you say? GEORGE MINGIN: I'd give them the finger, literally. TITLE CARD: "Hammered — inside the Bunnings machine" ANGUS GRIGG, REPORTER: Bunnings. It's home to smiling staff, aisles of seemingly endless choice and Australia's most famous sausage sizzle. TOURIST: The most Australian thing you could eat is a Bunnings sausage sizzle bro, it's a white piece of bread, sausage and some tomato sauce as they say. CAMEY O'KEEFE, BRANDING EXPERT: The Bunnings sausage sizzle is pure marketing genius. If you think about Bunnings, this is this mass market, big corporate chain, and through offering up at very low cost, the sausage sizzle every weekend they are strengthening community ties and building this local as like hyper-local association. But it also drives foot traffic to the location. ANGUS GRIGG, REPORTER: Branding expert Camey O'Keefe says no other retailer in Australia delivers such a simple, disciplined message. CAMEY O'KEEFE, BRANDING EXPERT: I would say the fact that Bunnings has held to this really consistent look and feel for decades now absolutely has contributed to the strength of the brand. ANGUS GRIGG, REPORTER: That brand strength helped Bunnings generate $19 billion in revenue last year. That's 5 times more than its nearest competitor. PROFESSOR CLINTON FREE, UNIVERSITY OF SYDNEY BUSINESS SCHOOL: Bunnings' result is really quite extraordinary and it really plays in the league of its own in terms of big box retail, not just in Australia, but I think internationally as well. ANGUS GRIGG, REPORTER: Bunnings is also super profitable. Last year its profit margin was almost 17 per cent, that's nearly double that of Coles, and significantly higher than Woolworths'. PROFESSOR CLINTON FREE: Bunnings has managed itself very skillfully through flying under the radar a little bit, having a very trusted brand, having a CEO without an enormous public profile. It meant that it's not been subject to scrutiny in the same way that, for example, Coles and Woolworths have. ANGUS GRIGG, REPORTER: Professor Clinton Free did his doctorate at Oxford University on market power and says high profits typically flow from weak competition. PROFESSOR CLINTON FREE: There's a number of interesting angles to the Bunnings story. It's an enormous success financially, but it also starts to raise big questions about market power. ANGUS GRIGG, REPORTER: Bunnings market share is highly contested. The company claims it competes against almost everyone, from Coles and Woolies, to Kmart, Myer and JB Hifi. Even Spotlight. That's not to mention Amazon, eBay, Kogan, PetStock, Petbarn…the list goes on. That's how it's able to claim a market share of just 17%. It's impossible to independently verify this figure, because Bunnings won't release detailed data. Research firm IbisWorld puts Bunnings' market share at around 33% of retail hardware, while noting it's far and away the leading player in the claim its market share is double this. JOHN DAHSLEN, CHAIRMAN, DAHLSENS: Bunnings itself has a higher, much higher market share than, uh, than Coles and Woolworths combined. But further the rest of the market, there's no one, uh, powerful enough to challenge them. ANGUS GRIGG, REPORTER: John Dahlsen runs a chain of hardware stores. He's also a competition lawyer, and former chairman of Woolworths JOHN DAHSLEN, CHAIRMAN, DAHLSENS: To be brutal, I think they are a quasi-monopoly. They don't want to promote the fact that they've got a huge market share because that's very bad for their image. PROFESSOR CLINTON FREE: A company with 30% market share exercises substantial market power. At 60 or 70% market share, I think you can dictate prices, you can dominate suppliers, and you can really repel new entrants and make it very difficult to compete for others. ANGUS GRIGG, REPORTER: Last year when the supermarkets were being called to account over price gouging and supplier mistreatment, allegations began to emerge against Bunnings. KAREN BROCK, BROCKLANDS NURSERY: We felt that we were slaves to Bunnings. We were like a mouse running around the hamster wheel. PETER SMITH, BOOMAROO NURSERY: Every time we requested a price increase, some kind of threat was made to make you feel like you were asking for something completely terrible. SENATOR ROSS CADELL: Yeah, I hear lowest prices are only the beginning cause the rest of the story is a bit of a horror story…from what I hear ANGUS GRIGG, REPORTER: There was parliamentary momentum. A Big Box Retailer Inquiry was setup to examine abuses of market power. It's since stalled, allowing the slow march of Bunnings to continue. It's a busy weekday morning at this Mitre 10 in the outer Brisbane suburb of Jimboomba. DAVID WOODMAN, MITRE 10 OWNER: How are you today, ma'am? ANGUS GRIGG, REPORTER: Owner David Woodman is on the floor. DAVID WOODMAN, MITRE 10 OWNER: What can I do to help you? You've got everything you need? ANGUS GRIGG, REPORTER: His family have been in the hardware business for 90 years. He's owned this Mitre 10 since 2018. DAVID WOODMAN: It's very well ranged, it's well priced, it's well stocked. We're competitive on pricing. But above all, we offer a really genuine service. ANGUS GRIGG, REPORTER: But this store is now under threat. DAVID WOODMAN, MITRE 10 OWNER: Bunnings have bought the property next door and they've advertised or put in the newspapers that they're going to build a 15,000 plus square metre box next door to us. ANGUS GRIGG, REPORTER: To put that in perspective, that's at least eight times bigger than David Woodman's store. Plans approved by Logan City council show the new Bunnings will take up this entire block, with the main warehouse, a garden centre, a timber yard, and a car park for more than 370 vehicles. There are already three well-established Bunnings within a 30 km radius. And in greater Brisbane, there's more than a dozen others. ANGUS GRIGG: If Bunnings open here, what impact will it have on your business? DAVID WOODMAN: Look, just based on our past experience, it's not going to be good. We think it'll affect our sales to the point where we'll end up losing profits. And being a small family business, we can't sustain that, so we'd probably end up shutting the store. ANGUS GRIGG: What do you think it means that they're setting up next door. DAVID WOODMAN: Oh look, I think it really only means one thing, that they really want to put us out of business. They know from other sites that that's what happens. And so I can only imagine that's their plan. ANGUS GRIGG: Does it feel predatory? DAVID WOODMAN: By definition? I think that's what it is. Certainly, that's the way it feels anyway. ANGUS GRIGG, REPORTER: And it's not just his Mitre 10 that could be impacted. DAVID WOODMAN: Bunnings have a very broad range. So stores like pool supply companies like mower shops, other timber merchants and paint shops, plumbing shops, they'll all be affected. ANGUS GRIGG: You don't have to drive far to see what he means. I'm just coming past the site purchased by Bunnings and as you can see, it's massive. And just up here is a cul-de-sac. ANGUS GRIGG, REPORTER: Here, there's a plumbing supplies store, behind that a shop selling lawn mowers and over the road is a business selling building materials. ANGUS GRIGG: Okay so I'm just heading back out to the main road. ANGUS GRIGG, REPORTER: Here, there's a blinds shop, a landscaping supply store. That's not to mention the water pump shop, the business selling chainsaws and the pool supply store. ANGUS GRIGG: All these businesses will be affected by Bunnings coming to town. ANGUS GRIGG, REPORTER: Some say the hardware giant's arrival could benefit their business, while others are deeply concerned. Bunnings declined an on-camera interview with Four Corners but in a statement said its new store will bring more choice and competition, and provide local jobs when it opens next year. David Woodman believes consumers will lose out if he's forced to shut. DAVID WOODMAN: They don't carry all the same brands as we do. So once we go, customers are going to lose access to all those brands. It's all about , it's about choice of service, it's about choice of range. ANGUS GRIGG, REPORTER: While there's little to stop Bunnings setting up next to David Woodman's Mitre 10, the hardware giant likes to prevent others from moving onto its turf. Emails seen by Four Corners show how Bunnings locks out its rivals from prime retail locations. In 2021 one rival was keen to open a store in this new retail precinct on the Gold Coast, only to be told Bunnings had an exclusivity clause in its leasing agreement. VOICE: "…Tools cannot be accommodated …. due to Bunnings exclusivity". ANGUS GRIGG, REPORTER: And it's not just on the Gold Coast. In the same year, a that rival tried to open a store in the outer Melbourne suburb of Melton. They were told: VOICE: "Unfortunately Bunnings have put a restriction clause on the development for all tool operators … ANGUS GRIGG, REPORTER: Then last year it came up against the same restriction on the NSW central coast. VOICE: "Unfortunately, Bunnings have exclusivity in the centre for tools". ANGUS GRIGG, REPORTER: Bunnings says such arrangements are only used on "select occasions" to protect its investment and that these usually only last 10 years. In 2009, regulator, the ACCC, forced Coles and Woolworths to end the use of these exclusivity clauses because they inhibit competition. Next year, the regulator will have new powers to scrutinise land acquisitions and leases, but these won't apply retrospectively. Bunnings was not always so dominant. It began life as a WA timber company prior to federation. In the early 1960s it expanded into retail, only opening its first warehouse in 1994. MITRE 10 TVC: At Mitre 10 we have all the tools, the timber, materials you need ANGUS GRIGG, REPORTER: Back then, with around 10% market share, Mitre 10 was the dominant player, and there were hundreds of local independents. The superstore concept was yet to be tested. REPORTER: This new Mitre 10 store may soon be in battle against a Bunnings superstore being planned for just down the road. STORE MANAGER, STUD PARK MITRE 10: I believe a well run, smaller owner operated store will always be able to compete ANGUS GRIGG, REPORTER: That Mitre 10 store in Melbourne no longer exists. In the decades since, Bunnings has expanded aggressively. In 1993 it took over McEwans hardware, then in 2001 it moved on BBC Hardware, also trading as Hardware House, giving it a national footprint. Competition regulator, the ACCC, waived through the deal without a single objection. As the new millennium began Bunnings had $1.4 billion in sales across 47 stores. Today its revenue is 13 times that across a massive empire. As well as 310 warehouses, it has specialist tile and tool chains, acquired with no objection from the ACCC. For consumers, part of the Bunnings appeal is its heavily promoted price match guarantee. BUNNINGS TVC: Get inspired this DIY July and get it done for less. Citeco ladder $159. When you find a competitor's price on the same stocked item, we'll beat it by 10%. ANGUS GRIGG: So I've just purchased the ladder shown in the ad. But what I'm wondering is could I have found it cheaper somewhere else … as we all know Bunnings tells us if we can find a cheaper price on a stocked item they'll beat it by 10 per cent. ANGUS GRIGG: Hey there, just wondering what you sell this for? ANGUS GRIGG: Afternoon, just wondering, do you have this type of ladder? ANGUS GRIGG: Hey there, just wondering what you sell this for? SHOPKEEPER 1: I don't have that brand SHOPKEEPER 2: This ladder I don't have SHOPKEEPER 3: We don't actually stock that brand, we can get a similar one. ANGUS GRIGG: So you don't sell Citeco? SHOPKEEPER 1: No, I don't. Haven't seen that brand before. HARDWARE MAN 2: No I don't have that Citeco ANGUS GRIGG: You don't do Citeco? SHOPKEEPER 3: I think you can only get that at Bunnings. ANGUS GRIGG: So it turns out you can't buy this ladder anywhere else. That's because it's a Bunnings house brand. It's not only manufactured for Bunnings but Bunnings even owns the trademark … not that you'd ever know. Bunnings ownership of the Citeco brand is not clearly disclosed anywhere on the ladder or in-store. And on the Bunnings website it's sold like any other brand. So what does that mean for its price guarantee? JOHN DAHSLEN, CHAIRMAN, DAHLSENS: The 10% beat thing is illusionary because it only applies to a limited number of, uh, Bunnings products. DAVID WOODMAN, MITRE 10 OWNER: I wish consumers realized that in that instance that 10% price match guarantee means nothing. ANGUS GRIGG, REPORTER: The Citeco ladder is far from the only example where Bunnings has attached its 10 per cent price guarantee to a home brand product. Four Corners has identified dozens of examples of this in TV ads, and in-store. Some home brands at Bunnings, like Trojan tools, even have their own websites and helpful videos. TROJAN TOOLS VIDEO: Hi, I'm Adam Dovell and welcome to Trojans Tools for Tasks… ANGUS GRIGG, REPORTER: Regulator, the ACCC, told Four Corners that it could be misleading or deceptive if a home brand is marketed as though it's produced by a third party. MATTHEW STEEN, CHOICE: So this is where we test choice washing machines, uh, dishwashers, fridges, a whole bunch of different product categories for the Australian market. ANGUS GRIGG, REPORTER: Matt Steen is a director with consumer advocacy group, CHOICE. He oversees product testing. MATTHEW STEEN, CHOICE: What you can see here are the barbecues. These are two from Bunnings that we tested for the past summer. ANGUS GRIGG: How do they perform? MATTHEW STEEN, CHOICE: Uh, pretty average. They're pretty much middle of the road. ANGUS GRIGG: Is there anywhere on here where it actually says it's a Bunnings home brand product? MATTHEW STEEN, CHOICE: No, there's nowhere on the packaging or on the products themselves that actually says it's a Bunnings only product. You cannot find them elsewhere ANGUS GRIGG: In your opinion, what would be best practice for Bunnings as it relates to home brand and the 10% price guarantee? MATTHEW STEEN, CHOICE: I think Bunnings should basically make it more transparent about, uh, how people can actually get that 10% guarantee realistically get it, uh, which is not including their home brand products. And so incorporation of some kind of labelling into their packaging and products would be really useful. ANGUS GRIGG, REPORTER: Bunnings says it complies with all legal and regulatory requirements for product labelling. As for the price match guarantee, it says this can be applied to similar items and that it empowers staff to take a "common sense approach". Bunnings is pushing hard into home brands, and says it owns trademarks covering more than 9,000 products. Everything from Jumbuck BBQs to Marquee outdoor furniture, Craftright toolboxes, Mondella toilets and Happy Tails pet supplies. JOHN DAHSLEN:, CHAIRMAN, DAHLSENS It's been established quite clearly that you make more money out of home brands because basically you removed from the supplier all the costs they have in marketing and promoting their brand. ANGUS GRIGG, REPORTER: Then there are brands that are exclusive to Bunnings. For local hardware stores, these exclusive arrangements hurt their ability to compete. ANGUS GRIGG: So what brands can't you stock because Bunnings has the exclusive arrangement. DES WILLIAMS, MITRE 10: Well, one that comes to mind is Ryobi, which is a popular brand out there, and Irwin Speedbor bits, drills, screwdriver bits, all very popular. We can't even purchase them. Bunnings has those all exclusively. ANGUS GRIGG, REPORTER: Bunnings says exclusive brands are common across a range of channels and retailers, including at Mitre 10 stores. For suppliers, selling through Bunnings can be a risky proposition. While it gives them the opportunity to sell large volumes, the hardware titan often has the upper hand. GEORGE MINGIN, KOOKABURRA WORM FARMS: They had enormous power over us. GEORGE MINGIN: Do you want to come and look in the worm shed, what we call the worm cave… ANGUS GRIGG: Yeah, Wow. OK. ANGUS GRIGG, REPORTER: We're in regional Queensland to meet worm farmer, George Mingin GEORGE MINGIN; So you can see it's quite a large shed and before when we supplied Bunnings, this shed was chock a block full of crates like these bins that are here are just what's leftover from the Bunnings contract. ANGUS GRIGG, REPORTER: For 8 years George and his wife Katherine supplied live worms to Bunnings. They are one of the few suppliers willing to speak publicly about what it's like to deal with the hardware giant. GEORGE MINGIN: For many years I'd tried to get into Bunnings, but it was very, very difficult. And then suddenly this opportunity arose and we thought, you beauty, you know, we are in. And at first it was great. It was fantastic. ANGUS GRIGG, REPORTER: In the early years the couple felt they had a solid partnership with Bunnings. GEORGE MINGIN: We found that there was a lot of opportunity to grow the business. we changed our packaging considerably, made it much more attractive and more modern. Um, and all those little things that we did helped us to build a brand. And we basically tripled our volume. ANGUS GRIGG, REPORTER: That saw sales reach $1.3 million annually, and their margins were solid. Then things began to change. KATHERINE MINGIN: Little by little they started applying more pressure on their suppliers, certainly on us, and the expectations started to grow. Our buyers were starting to put the thumb screws on us. ANGUS GRIGG, REPORTER: And then COVID hit and like many businesses their costs rose sharply. GEORGE MINGIN: So that pushed all wages up, packaging costs, transport costs went through the roof. Um, so our margins eroded to literally nothing, we were running three overdrafts of $50,000 each, and they were all maxed out. ANGUS GRIGG, REPORTER: They were going broke fast, and had no other choice but to ask for a price increase. GEORGE MINGIN: We just, we couldn't continue. So we went to Bunnings and we told them where all of our prices had gone up, and we basically needed 30% price increase. KATHERINE MINGIN: We just instinctively knew that, um, asking for a price increase, however big or small was not going to go well. ANGUS GRIGG: What was the reaction to that? GEORGE MINGIN: We're working on it. We're looking at it. Um, but no explanation as to why nothing's happening. GEORGE MINGIN: And we kept contacting him, emailing, ringing, nothing, nothing, nothing. KATHERINE MINGIN: No, Bunnings don't need to give explanations. GEORGE MINGIN: For nearly 10 years, we had no price increase. And the business had been operating before we bought it, and they had no price increases. ANGUS GRIGG, REPORTER: After six months of being strung along, Bunnings handed down its decision. They were putting the worms contract out to tender. KATHERINE MINGIN: That was a bombshell that was really unexpected and a huge shock. GEORGE MINGIN: The buyer explained to us that they did not want to sacrifice their margins, and they did not want to put the pricing up. ANGUS GRIGG, REPORTER: At this point, Bunnings had done very well out of its partnership with George and Katherine. It purchased a bag of worms for $29.94 selling it to customers for $49.90. That's a 66 per cent mark up. But this does not capture all the profits flowing to Bunnings. GEORGE MINGIN: So you put your invoice in and you think, right, we've made really good sales this week. ANGUS GRIGG, REPORTER: Then comes what's known as rebates — money a supplier has to pay Bunnings, based on their sales. For George and Katherine at times this included: a volume rebate of up to 7 percent, 15% for new store openings, and if they wanted to be paid more quickly that was another 5 per cent. Then there's marketing fees, and you might even have to pay if your stock is discounted. For the couple the bill was about $8000 a month, or 7% of their sales. GEORGE MINGIN: To me, that was highway robbery. It was just plain highway robbery. ANGUS GRIGG, REPORTER: In the end, the couple lost the tender. After 8 years supplying to Bunnings, they were given just one week's notice to finish and then sent a $5000 bill for rebates GEORGE MINGIN: We spent hundreds of thousands of dollars building this up, particularly for worms, and now it's a waste. It's like a garage. Real shame. KATHERINE MINGIN: We ended up having put in a lot of hard work for absolutely no gain whatsoever. In fact, um, yeah, we've lost, we've lost everything that we put back into the business simply to supply Bunnings. ANGUS GRIGG: If Bunnings asked you to come back and start resupplying them, what would you say? GEORGE MINGIN: I'd give them the finger, literally. Um, not interested. This is one bridge that we are happy to burn. ANGUS GRIGG, REPORTER: Bunnings says it does not comment on specific supplier agreements, but conducts business with integrity, honesty and respect. Last year when similar allegations were raised by suppliers in a Senate Inquiry, it was not Bunnings CEO, Mike Schneider, who turned up to face tough questions. SENATOR NICK MCKIM: We've heard words to the effect that Bunnings treats suppliers like slaves and like numbers, not people. ANGUS GRIGG, REPORTER: Instead, Bunnings sent two mid-level managers. SENATOR NICK MCKIM: Like what's your, what's your response to those allegations? BUNNINGS REPRESENTATIVES: I think both my colleague and myself shared a level of disappointment to hear about those supplier experiences. SENATOR TAMMY TYRRELL: Is there any explanation as to why Mr Schneider hasn't appeared? BUNNINGS REPRESENTATIVES: We think we are best placed to work with this committee… SENATOR ROSS CADELL: What's the average markup you put on goods in your green life sector? BUNNINGS REPRESENTATIVES: Senator, with regards to that it's extremely diverse from products, from trees and shrubs to … SENATOR ROSS CADELL: An average isn't diverse. An average is a figure. I've never heard anyone give fewer answers than you in the last half an hour. ANGUS GRIGG, REPORTER: Bunnings CEO Mike Schneider — who earnt $4.7 million last year — also wouldn't sit down with Four Corner. The PR team told us that the timing didn't work for them. Meanwhile the allegations against Bunnings continue to build. The latest is from a former manager who is now blowing the whistle. For 20 years Jason MacMartin held senior positions at Bunnings. He's now taking them to court for unfair dismissal, after being granted whistleblower protections for making a series of allegations. ANGUS GRIGG: Jason MacMartin is in court today here in Melbourne. His case will allege Bunnings systematically underpaid sales staff, had a culture of bullying and most explosively, engaged in anti-competitive behaviour. ANGUS GRIGG, REPORTER: While it's before the court, Jason MacMartin won't comment. But in his statement of claim, he alleges Bunnings ignored his concerns around the underpayment of staff, and that he was bullied and demoted for raising these. Court documents show he was given whistleblower status over the bullying claims, as well as over allegations of anti-competitive behaviour within the sales team. ANGUS GRIGG, REPORTER: Bunnings has filed a defence to the unfair dismissal claim, and rejects allegations of underpayment, bullying and anti-competitive behaviour. It says they've already been thoroughly investigated and were not substantiated. ANGUS GRIGG, REPORTER: In Queensland, Bunnings is facing more legal action — this time from a one-time competitor turned supplier. TERRY BIRBILIS, FORMER SUPPLIER: This is where the factory was. We were here for over 20 years. ANGUS GRIGG, REPORTER: Terry Birbilis was once a local manufacturing success story. Now, he's suing Bunnings in the state's supreme court. TERRY BIRBILIS: We geared up specifically for Bunnings. We gave Bunnings priority of work. ANGUS GRIGG, REPORTER: Terry's family business specialised in cabinets and wardrobes. For years, they worked with both Bunnings and its rivals. Then, in 2019, Terry Birbilis signed a contract with the big box retailer, agreeing to give it priority. TERRY BIRBILIS: It was an exceptionally attractive commercial deal, something that anyone would be very honoured to look at. ANGUS GRIGG: Okay, so this is it? TERRY BIRBILIS: This is it Angus. This is one of the 200 plus kitchens that we did in this apartment for Bunnings that we supplied. ANGUS GRIGG, REPORTER: The deal between Bunnings and Birbilis obligated the retailer to purchase a minimum of $5 million worth of kitchens from Birbilis each year or 33 per cent of its sales in this category. TERRY BIRBILIS: It was all built to specifications for Bunnings, locally sourced timber. ANGUS GRIGG, REPORTER: Birbilis claims Bunnings staff told him the contract could eventually be worth as much as $75 million a year. In return, he agreed to install specialist manufacturing equipment and software. TERRY BIRBILIS: We were an avid supporter of the local supply chain. We bought a lot of product that created jobs. We employed a lot of apprentices. We ticked all the boxes for them, and then the sales just didn't happen. Nothing happened. ANGUS GRIGG, REPORTER: Birbilis says the failure of these sales to materialise had a catastrophic impact on the family business. TERRY BIRBILIS: It's meant the business has literally wound up. We're now pursuing it through the courts to try and get a resolution, but for all intents and purposes, the business has gone. ANGUS GRIGG, REPORTER: Terry Birbilis is suing Bunnings for breach of contract. ANGUS GRIGG, REPORTER: Bunnings disputes the allegations and says it's vigorously defending the case. It declined to comment further. ANGUS GRIGG: How does it feel coming back and seeing it all locked up? TERRY BIRBILIS: Heartbreaking. Genuinely heartbreaking. A lot of our staff were here for 15, 20 years. Our longest staff member was here for over 40 years. True waste of a great opportunity for so many people. ANGUS GRIGG: You'd think with its ability to pressure suppliers and extract efficiencies from its sheer size, Bunnings would be vastly cheaper than its competitors. But that's not what we found. We set out to do a price comparison on 95 basic hardware items. We checked prices at Bunnings and its closest competitors. It's a rough basket of goods, and by no means a complete analysis. But what we found did surprise us. ANGUS GRIGG: Take this Stanley Claw hammer. It's $15 50, whether you buy it at Bunnings or Mitre 10. And it's the same on big ticket items like this line trimmer. It's $299, whether you buy it at Bunnings or its competitors. And sometimes when Bunnings is cheaper, it's comically so. Take this Gorilla Grip glue. It's just 3 cents cheaper at Bunnings compared to Mitre 10. ANGUS GRIGG, REPORTER: When we did the comparison, the difference between Bunnings and its local rivals was literally small change. Over the 95 items we surveyed, Bunnings was only 2.3 per cent cheaper than Mitre 10, 2.4% cheaper than Amazon, and compared to Total Tools, it was only 1.7 per cent cheaper. For a consumer that works out to be a one to two dollar saving for every $100 they spend. But a company making such huge profits could offer much cheaper prices at the checkout. PROFESSOR CLINTON FREE: I think when companies start to dominate a market to that extent, they stop being focused on winning customers and loyalty and start being focused on extracting value from customers and suppliers. And I think that means doing things which are really about extracting margin from really from customers and from their suppliers. ANGUS GRIGG, REPORTER: Even when Bunnings or its subsidiaries — like Tool Kit Depot — offer discounts, there can be a catch. TOOLKIT DEPOT TVC: Tool Kit depot that's what it stands for, it's the place to go for all those tradies out there. ANGUS GRIGG, REPORTER: Last year internet sleuths noted Tool Kit Depot was promoting a $101 saving on a Milwaukee power pack for members of its loyalty program. It turns out the price was actually $459 more expensive than the most recent price members had been offered. ANGUS GRIGG, REPORTER: Dubious specials is something the ACCC is cracking down on in the supermarket sector. GINA CASS-GOTTLIEB, CHAIR, ACCC: The ACCC alleges that the price discounts as promoted were misleading because the discount was illusory. ANGUS GRIGG, REPORTER: But so far there's no talk of extending this scrutiny to hardware. Bunnings says the before and after prices were clearly marked on the Milwaukee power packs and it's committed to delivering the lowest prices to customers. Labor began the recent election campaign pledging to crack down on companies abusing their market power. PRIME MINISTER ANTHONY ALBANESE: We will make price gouging by Australian supermarkets illegal. Price gouging is when supermarkets are taking the piss. ANGUS GRIGG, REPORTER: The Coalition planned to go even further — they wanted the power to break up the supermarket duopoly and there was a push to include Bunnings. DAVID LITTLEPROUD: There should be an extension to Bunnings. In society you have to have a deterrence and a consequence. ANGUS GRIGG, REPORTER: And now, with a historic mandate, Labor must decide how far to go. Treasurer Jim Chalmers is hedging his bets on whether Bunnings should be subject to a code of conduct similar to that imposed on the supermarkets. TREASURER JIM CHALMERS: I'm aware that people have raised concerns about Bunnings, particularly when it comes to the nursery, part of the business. Our primary focus is supermarkets, but we've given the ACCC the resources that they need and the ability to recommend to us a broader focus, if that's warranted. PROFESSOR CLINTON FREE: It seems to me odd that Bunnings isn't subject to something like the food and grocery code of conduct that binds Coles and Woolworths. If we look at market share, Bunnings controls a share of the market, which is probably greater than Woolies and Coles combined in many important categories, yet it isn't really subject to the same scrutiny. ANGUS GRIGG, REPORTER: In the absence of strong competition policy or regulation, Bunnings is pushing into new areas to keep its profits growing, and its shareholders happy. For almost 150 years Dahlsens has been selling hardware in the Gippsland region of Victoria. JOHN DAHLSEN, CHAIRMAN, DAHLSENS: As builders go to work, they, they all queue up to get their supplies. So there's a period of hour, maybe two hours of frantic trading. ANGUS GRIGG, REPORTER: Today is no different. But who Dahlsens sell this hardware to has changed dramatically in recent years. JOHN DAHLSEN: The DIY component in our business across Australia would be, would be less than 5 per cent. ANGUS GRIGG, REPORTER: John Dahlsen is chairman of the Dahlsens' hardware chain. The family has more than 65 stores across the country but has largely exited DIY hardware and become a trade specialist. JOHN DAHLSEN: We had no future in, in retail hardware, just as, I don't believe anyone else has a future in retail hardware. We were unable to match the huge variety of product that Bunnings has. We are at Bunning's Mercy. ANGUS GRIGG, REPORTER: Having conquered DIY, Bunnings is now pushing further into the trade sector. JOHN DAHLSEN: You'll see there's no waste hanging around the floor or sawdust… ANGUS GRIGG, REPORTER: The hardware giant is attacking the roof truss and wall frame market. JOHN DAHLSEN: They decided this was a, a market they could disrupt. So they went and invested in these huge automated, uh, multimillion dollar plants, one in Melbourne and one in in Sydney. ANGUS GRIGG, REPORTER: John Dahlsen says Bunnings is heavily discounting this staple of the construction industry, seeking to grab market share from the independents. JOHN DAHLSEN: there's a huge overcapacity in the market, and our margins have shrunk. We're not, we're not a Bunnings money machine. We don't have the capacity to continue keep on quoting roof trusses at marginal rates for, for a long period of time. It is predatory. It's another example of small business, in our case, relatively small being, uh, unfairly damaged. ANGUS GRIGG, REPORTER: Independents say they have been able to hold the line against Bunnings in trade sales largely by providing better service at competitive prices. But John Dahlsen fears Bunnings has found their weak point. JOHN DAHSLEN: So if a builder gets a deep discount, say on a roof, truss and wall frame, he's more likely to buy the rest of the whole of the house. So it's not as if Bunnings has to discount everything, it just has to discount elements of the package to get the builder in. ANGUS GRIGG, REPORTER: Bunnings says new manufacturing technologies have allowed it to offer customers a better product with competitive pricing. Back in Jimboomba David Woodman is preparing to take Bunnings to court, in a last ditch effort to save his business. It's a legal long shot. DAVID WOODMAN, MITRE 10 OWNER: We won't give up. We owe it to the staff to fight and so we'll do what we can to stay open. We'll try and pivot. We'll take opportunities. If we see 'em, we'll try to stay open. but our experience has been that that won't be enough and that we'll end up having to close. GEORGE MINGIS, KOOKABURRA WORM FARMS: It's just, it's insane how big companies like Bunnings can get away doing what they do, but they do it because they have such a huge market share PROFESSOR CLINTON FREE: I think this is an important story to be ventilated and attention needs to go into a category which is very large, which affects lots of consumers, affects lots of suppliers, and they, they, they really should be subject to the same sort of scrutiny and regulation as our big retailers.
News.com.au
12-05-2025
- Business
- News.com.au
Four Corners ‘Hammered: Inside the Bunnings Machine' preview
Tonight on Four Corners, Angus Grigg and Emilia Terzon investigate how Bunnings went from weekend destination to one of Australia's most powerful retailers.
ABC News
11-05-2025
- Business
- ABC News
How Bunnings crushed its competitors
Sam Hawley: Who doesn't love a trip to Bunnings? It's cheap, the staff are cheery, you can fulfil your DIY dreams and have a sausage sandwich on the way out. But what really lies behind the promise of lowest prices? Today, Four Corners reporter, Angus Grigg, on his investigation into the store's market dominance and what it means for customers and suppliers. I'm Sam Hawley on Gadigal land in Sydney. This is ABC News Daily. Angus, who doesn't love a Bunnings sausage sizzle on the weekend? And even if you don't partake in it, it's the smell. Angus Grigg: Yes, absolutely. You know, it really is Australia's most famous sausage sizzle. And I guess, you know, on a sort of bigger note, it actually works very well with how Bunnings market itself. You know, you see this sort of smiling staff, very local, and also this sort of aisles of seemingly endless choice. So the sausage sizzle is a really integral part of how Bunnings sells itself and how people understand Bunnings. Sam Hawley: OK, and when you're biting into that sandwich, though, during your next Bunnings visit, it might be worth just bearing in mind that it is a very well-crafted marketing tool. Thank you very much. What do you say to the customers? Angus Grigg: Yeah, absolutely. I mean, it is pure marketing genius, really. And if you think about it, Bunnings is this giant corporate chain, right? Yet the sausage sizzle gives it this opportunity to market itself as hyper-local, to support local charities. So it is a really sort of brilliant bit of marketing that costs Bunnings very, very little. And one of the really interesting things about Bunnings is that they've been really consistent in their marketing. They're probably one of the few companies across Australia that stuck to the same colours, the same jingle, the same sort of style of ads, you know, for more than 20 years. Sam Hawley: Yeah, that really all contributed to the strength of the brand. Now, it first opened its first warehouse in 1994, and it's just been an incredible story, hasn't it? Angus Grigg: It is phenomenal. So Bunnings generates about 19 billion dollars in revenue each year. And just to put that into context, that is about five times more than its nearest competitor. But the really big thing and the thing that differentiates Bunnings is that it is super profitable. And we're talking profitable on global standards. So last year, it generated a profit margin of around 17%. Now, that is enormous on any scale. But just to give it some context, we talk about Coles and Woolworths, well, they generate a profit margin about half that. And you should also remember that the big two supermarkets have been criticised, particularly in the last year or so, for being among the most profitable supermarkets in the world. Well, Bunnings is twice as profitable as them. Sam Hawley: Yeah, that's incredible. Yeah. And it's those enormous figures that has now really got people asking questions about Bunnings' market power. Angus Grigg: Yeah. And this is one of the peculiar things about this story, is that there's actually no official or independent figures about Bunnings' market share. So actually, it's highly contested. And Bunnings comes up with this slightly implausible figure of 17% for its market share. And it does this by basically saying it competes against almost every retailer in the country. IbisWorld, which has done some research but acknowledges that it is a bit limited, it puts its market share at around 33%. When you talk to Bunnings' rivals, and we talk to quite a lot of them, they say the market share is probably double that. It's more like around 70%. One of the people we spoke to, John Dalson, who's a really interesting guy. He's 94 years old. He's been the chairman of Woolworths. He's a competition lawyer by training. But he also owns a chain of family hardware stores. And he says that Bunnings' market share is the equivalent of Coles and Woolworths combined. John Dahlsen, Hardware retailer: The rest of the market, there's no one powerful enough to challenge them. To be brutal, I think they are a quasi-monopoly. They don't want to promote the fact that they've got a huge market share because that's very bad for their image. Sam Hawley: I must admit, I can't really remember actually shopping at any other hardware stores for a really long time. I always go to Bunnings. So what happened to all the Mitre10s that used to be around back in the day? Angus Grigg: When you put it like that, it does really tell you how overwhelming or dominant the Bunnings' market position is. But what Bunnings did, and they were really smart about it, is that they had a corporatised model. And they were backed by the ASX listed West Farmers. And so they had the sort of financial firepower, if you like, to roll out a lot of stores. Whereas Mitre 10 was more of a sort of licensing franchise model, and it just couldn't really compete. Bunnings, first of all, it took over McEwen's hardware, and then in 2001, it moved on BBC hardware. And both of these deals were waved through by the ACCC without any great concerns. But Bunnings has just continued to expand very, very aggressively, really from about 2000 onwards. Sam Hawley: Alright, so Angus, now we've got a very good idea of the power and scope of Bunnings. Let's just delve even deeper into how it actually got there. It's not just the sausage sizzle, of course. Angus Grigg: Yes, indeed. Sam Hawley: Now you spoke to David Woodman. Just tell me about his story. Angus Grigg: Yeah, he's an interesting guy, actually. So he has a couple of Mitre 10 hardware stores around Mackay and all around the country. And he's got a very good idea of what he's and his family's really been in the business, you know, for a long time since 1935. David Woodman, Mitre 10 business owner: Well, it's very well arranged. It's well priced. It's well stocked. We're competitive on pricing. But above all, we offer a really genuine service. Angus Grigg: One of his stores is in Jimboomba, which is on the sort of outer suburbs of Brisbane. What's happened to him is that Bunnings have bought the block of land right next door to his Mitre 10 store, and they're planning to build a massive new Bunnings, which will be about 15,000 square metres. And that is about eight times bigger than his store. David Woodman, Mitre 10 business owner: Look, just based on our past experience, it's not going to be good. We think that it'll affect our sales to the point where we'll end up losing profits. And being a small family business, we can't sustain that. So we'd probably end up shutting the store. Angus Grigg: The sort of other interesting thing is here is that there's three Bunnings within about 25, 26 kilometre radius of Dave Woodman's Mitre 10, and there's about a dozen Bunnings stores in Greater Brisbane. David Woodman, Mitre 10 business owner: "Does it feel predatory?" By definition. I think that's what it is. Certainly that's the way it feels anyway. Hardware is heading in exactly the same direction as the supermarkets, only worse because they've at least got two bloody dominant Angus Grigg: players. And he says that, you know, Bunnings are opening next door to him with the view of shutting him down. Bunnings deny that and they actually say often when their stores open, it fosters competition, it gives consumers greater choice. Sam Hawley: And David points out as well that it's not only his store that will suffer because Bunnings sells pretty much everything, doesn't it, Angus, including worms. Angus Grigg: Yes. One of the things that you may be surprised to know that Bunnings sells worms and worm farms for compost. And so we went and visited some worm farmers, George and Katherine Mingis, just near Bundaberg in Queensland. George Mingis, worm supplier: Do you want to come in and have a look in the worm shed? Sure. What we call the worm cave. Yeah. Wow. Okay. Angus Grigg: You know, their story is quite an interesting one. And I should say they're one of the few suppliers that were willing to speak to us. George Mingis, worm supplier: For many years, I'd tried to get into Bunnings, but it was very, very difficult. And then suddenly this opportunity arose and we thought, you beauty, you know, we're in. And at first it was great. It was fantastic. Angus Grigg: So George and Katherine started supplying Bunnings with their worms about eight years ago, and they had a pretty good business. They were selling about $1.3 million worth of worms to Bunnings each year. They were making pretty solid margins. Like many businesses, COVID struck and their costs went up quite a lot. George Mingis, worm supplier: So that pushed all wages up, packaging costs, transport costs went through the roof. So our margins eroded to literally nothing. Angus Grigg: And so George and Catherine, umm'd and ahh'd, and with sort of great trepidation, actually asked Bunnings for a 10% price increase, even though really they needed about a 30% price increase. And then finally Bunnings said, actually, we're putting it out to tender. And they were told sometime later that they'd lost the contract. If Bunnings asked you to come back and start resupplying them, what would you say? George Mingis, worm supplier: I'd give them the finger, literally. Not interested. This is one bridge that we're happy to burn. Angus Grigg: Now we should also say here, there was a little bit of room. Bunnings was making a really good margin out of them. So they were selling their product, their standard product of a thousand worms to Bunnings for about $30 per packet. And Bunnings were selling it for just under $50. So they were making a 66% markup on their product. Sam Hawley: And I guess when you're a consumer in Bunnings, you sort of think that everything's really, really good value. So you went and did a little test just to see if that's true. Angus Grigg: Yeah, exactly. I mean, I think what we, the conclusion we really came to is that, yeah, Bunnings is cheap, but it should be far cheaper. We went and looked at 95 basic hardware items. We should say that it is an imperfect study, that it is a rough basket of goods. To our surprise, actually, we found that Bunnings was only 2.3% cheaper over this basket of goods than Mitre 10. It was 2.4% cheaper than Amazon, and it was 1.7% cheaper than Total Tools. So yes, it is moderately cheaper, but we're talking, you know, $1 or $2 for every $100. Now, just go back to what we were saying earlier, when you're a retailer that is making a return on invested capital of around 70% and you're making a profit margin of 19%, you should be so much cheaper than the competition. Sam Hawley: And you also found, Angus, the price guarantee that they have on some items, well, it's not particularly useful. Angus Grigg: It's a bit illusionary, I'd say, yes. Bunnings advertisement: If you happen to find a cheaper price on a stock item, we'll beat it by 10%. Angus Grigg: Bunnings often attaches these 10% price guarantee signs to its home brand products. Now, the problem is that with home brand products, they are made exclusively for Bunnings. So therefore, you can't find a stocked item cheaper because literally that stocked item does not exist in another store. And look, I should say that Bunnings says that it does price match on similar items, but Choice, the consumer organisation, says, you know, they need to be more transparent on this and that they shouldn't put this price match guarantee on their house brand products. Sam Hawley: Well, Angus, the government went through the election campaign promising to crack down on companies abusing their market power. Anthony Albanese, Prime Minister: We will make price gouging by Australian supermarkets illegal. Price gouging is when supermarkets are taking the piss. Sam Hawley: But what about Bunnings? Angus Grigg: Yeah, this is the really interesting thing about this story. Despite Bunnings' enormous market power, there's very, very little scrutiny. And so there is a bit of pressure on the government to actually do something. So, you know, Jim Chalmers is hedging his bets a bit here. But, you know, one of the things that he could do is to have a sort of independent investigation by the ACCC to look at firstly and establish what is Bunnings' market position, what is its market power. The other thing that there is a bit of a push for is to put in a compulsory code of conduct for Bunnings and how it treats its suppliers. And I think that actually would be a very good step forward to give the suppliers some power and make it a more even relationship with Bunnings. Sam Hawley: All right. So, Angus, what's your advice for consumers then? The thing is we know people like Bunnings, the convenience of it, that everything's there in one place. Angus Grigg: Well, absolutely. Look, Bunnings, you know, really is a brilliant business model. And really, it's not really so much for consumers. It's more of a competition issue and an issue for the government about what sort of an economy we want. And what we know is that if we don't have competition, consumers lose out through higher prices. But it's very difficult to see how they reign in the power of Bunnings. Yeah, I'm not sure there's a great deal the government can do other than sort of crimp their expansion a bit around the edges and maybe look at some of their pricing policies. Sam Hawley: Angus Grigg is an investigative reporter. You can watch his Four Corners story on ABC TV tonight at 8.30 or catch it on iView. This episode was produced by Sydney Pead and Adair Sheppard. Audio production by Sam Dunn. Our supervising producer is David Coady. I'm Sam Hawley. To get in touch with the team, please email us at abcnewsdaily@ Thanks for listening.
ABC News
07-05-2025
- Business
- ABC News
VIDEO: Hammered: Inside the Bunnings Machine
Skip to main content We love Bunnings — it's where we go for our weekend sausage sizzle and to fulfill our DIY dreams. But what if the store Australians trust most is not as benign as it would have us believe? Bunnings has quietly become one of Australia's most dominant and profitable retailers, with rivals saying its market power matches Coles and Woolworths combined. Yet it faces none of the scrutiny of the big two supermarkets. Critics also claim it's a corporate predator systematically picking off independents, shutting down competition and abusing its dominance with suppliers. For its part Bunnings insists it's just another competitor in a crowded field. Four Corners' Angus Grigg and Emilia Terzon from the ABC business team dig into Bunnings' unchecked dominance, its soaring profits, and whether regulators have turned a blind eye while it reshapes Australian retail. This is the untold story of how Bunnings became a national icon — and what we lose when one brand dominates the backyard. Hammered reported by Angus Grigg and Emilia Terzon, produced by Elise Potaka goes to air on Monday 12 May at 8.30pm on ABC TV and ABC iview.
