Dick Smith Foods Issue Analysis

Dick Smith Foods Issue Analysis.

Dick Smith Foods

Issue Analysis

Since the establishment of Dick Smith Foods in February 2000, the company has caused a great many controversies, however, none quite as important to the organisation and its publics as the current issue about to be discussed.

The Issue Origins

Australian entrepreneur Dick Smith established the business, Dick Smith Foods, in 2000 to help boost the struggling Australian foods industry. His idea was to use Australian products manufactured by existing Australian companies to further the plight of the struggling Australian foods industry.

Australian retail giants, Coles and Woolworths (and their subsidiary companies) agreed to stock the Australian-made and owned products on their shelves. Demand, however, was not as great as anticipated. While Dick Smith Foods started out with a range of approximately 90 products on store shelves, it has been continually narrowed to today's range of just 11 different products.

The reduction in products has been due to lack of consumer demand for Dick Smith's products. Coles and Woolworths refuse to stock products that will not make large profit-margins for their businesses.

The Current Issue

Now, Dick Smith Foods are under threat of becoming extinct. Coles and Woolworths are threatening to take Dick Smith Foods' products and products from other leading Australian-owned companies such as Golden Circle, off store shelves.

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It is surmised that this action is being taken to compete with the new International Store, German-owned Aldi, which has already opened in Australia. Due to their small product range and low prices, Aldi is already proving to be a major threat to Coles and Woolworths.

The Impact on Dick Smith Foods

If Dick Smith Foods' products were to be taken off its retailer's shelves, then it would no longer be able to sell its products, as it would have no venue through which to do this.