In theory Coles is not compelled to raise prices, so the theoretical answer to your question is no.
However, real world conditions compel them to do so. The same theoretical world would tell us that the costs of rent, supplies and labour also did not have to increase.
The disclosed annual profit for the 2023 financial year is less than 3% of turnover. Food inflation for the same period is reported at 7.5%. If Coles didn’t increase prices, the would be reporting a multi billion dollar loss, likely leading to cuts in staff and stores.
The company’s annual report lists an annual increase of 2.9% in income before interest and tax. This is less than half of the inflation figure and means that Coles would not have passed on the full increase in costs to customers.
