You are confusing monopolies/duopolies with competition. Competition is when two or more businesses adjust prices to capture a known demand. Competition can’t exist in a monopoly, but can exist in a duopoly or more than two businesses within the same sector. Where there is a monopoly, these are regulated to ensure fair pricing to protect consumer interests.
How, Aldi has been very strategic in its expansion and has beempn very successful in capturing market share in areas it trades.
It is worth reading why Kaufland pulled investment in Australia. Like Cosco, Kaufland is a volume low margin business. If you don’t have volumes in a small marker like Australia, it doesn’t stack up.
ALDI had many hurdles to overcome in Sydney. In one shopping centre Coles made it possible that parking would be free if one has a coles receipt, a SHOP A DOCKET as it was called, but the shopping centre did not tell ALDI of this. And ALDI did not have such SHOP A DOCKETS
I discovered this shenanigan, pointed out to ALDI’s top dog (who blasted the shopping centre) and in a week the shopping centre took away Coles’ unfair advantage.
On the matter of competition in duopolies, it can only exist in the non price arena. Such as in the good old days, Ansett and Qantas. Of course the best way to achieve and encourage competition is to allow easy entry into the market. Paul Keating, a great Australian who either did not understand competition or had his reasons for avoiding doing some good allowed Qantas to buy TAA (or 'Australian Airlines" as it was then). Thus cementing a duoploly Qantas (+ Australian) v Ansett, where he should have allowed a foreign airline to buy Australian, thereby creating a three firm market where collusion between two would not dictate prices and quantities offered.
The low price guarantee topic diverged into monopolistic behaviour so I moved that divergent discussion to this existing topic where it seems more germane.
FWIW prior to that ‘merger’ Qantas was international and Ansett and TAA were domestic. Selling an airline to a foreign firm has national security implications be they real or imagined, and as time has gone on it seems our successive governments have been less and less concerned with foreign ownership - at least until very recently when it appears the US tapped a shoulder with concerns, eg the Port of Darwin and certain research engagements.
Apologies for this off topic comment that could have started another topic, ‘national security, competition, and foreign investment’ - if someone wishes to start that to continue the thought.
An interesting standard to determine the public interest. "Other industries are worse’. On that basis Australia should save money and disband this mob of window dressers who do not even dress windows.
Previous posts have considered some of the risks of a single enterprise or several coming to dominate a market.
Australia presents numerous opportunities for foreign owners to invest. There is often criticism of the net benefit going off shore, often through complex tax arrangements.
When it comes to control of food supply, especially locally produced product should we be concerned?
How evident is it to consumers that the product may be supplied through a foreign controlled company, or if there is real competition for that supply?
A couple of interesting asides.
Australia has $3.5 trillion saved in super as of March 2022.
The publicly listed companies on the Australian Stock Exchange at the end of March 2022 had a market capitalisation of $2.7 trillion. This value excludes any privately owned businesses or unlisted foreign ownership.
If Australian meat processing for Aldi, Coles, Woolies and MacDonalds is a profitable investment, why would it be foreign owned?
It seems foreign buyers are less risk averse and have deeper pockets than Australian buyers and can often outbid when Australian businesses are up for sale.
The ACCC will, in theory, have something to say if they sniff a possible monopoly situation. Assuming they have a book-marked dictionary nearby to check what that means.
The FIRB seems to pretty much wave through anything, as does the Treasurer, unless there is a some political side to it.
