Continuing to make food security our priority
A challenge facing Aboriginal people in remote communities is the lack of food security and high prices.
Driven by these issues, in 2019, AIG began managing community stores across the seven northern regions of the NT, with the aim to disrupt the remote community stores sector. Since then, we have managed stores in Timber Creek, Barunga, Yarralin and Wirrimanu, working to ensure these communities have access to food, beverages and essential items at the lowest possible price points.
And we’re on the right track.
A recent price check in the AIG-managed Bagala Store in Barunga showcased our pricing success, with a shopping basket with 16 essential items (chosen by the local store committee) only $6.49 more expensive than Coles/Woolworths pricing. We’re so proud of this result.
| BAGALA STORE JUNE 2023 | ||
|---|---|---|
| PRODUCT | STORE PRICE $ |
COLES / WOOLWORTHS PRICE $ |
| Milk powder (Coles brand) | 12.34 | 10.00 |
| Teabags (Lipton) 100 bags | 6.71 | 5.80 |
| Teabags (Bushell’s) 100 bags | 4.33 | 3.85 |
| CSR Raw Sugar 1kg | 3.34 | 2.20 |
| Margarine McGregor | 3.72 | 3.46 |
| Eggs (700g) | 7.80 | 7.50 |
| Eggs (600g) | 4.50 | 4.80 |
| Cordial (red) | 9.65 | 4.70 |
| Bread (white) | 4.05 | 5.99 |
| Hamper Corned Beef 200g | 6.50 | 5.80 |
| MiGoreng Dried Noodles (5 pack) | 4.48 | 3.95 |
| Dried Noodles (Suimin cup chicken) | 1.91 | 1.85 |
| Dried Noodles (Sumin chicken/prawn) | 1.75 | 1.85 |
| Lamb Cutlets | 20.41 | 20.62 |
| Mince (500g) | 10.50 | 10.00 |
| Steak (2 pk) | 16.87 | 20.00 |
| TOTAL | 118.86 | 112.37 |
Next step – a Member Buying Group
Our Strategy: AIG 2025 demonstrates the AIG Board’s determination to continue our positive food security and pricing disruption for remote communities.
By developing our own Member Buying Group we aim to increase buying power for independent stores across the seven northern regions of the NT. The group will drive down price points for store owners and ultimately deliver cheaper groceries for Aboriginal people living in remote communities.
We can only imagine how much further prices would be reduced if independent Indigenous-owned community stores, like the Bagala Store, had access to such buying power.
Our 3-step store management progression model to impact food security and pricing:
Step 1 – Development of a social enterprise community store model that focuses on social outcomes over profits – COMPLETE
Step 2 – Transitioning of the store to a model of self-management with the option of reduced back-office support and supply chain access for best pricing – ALMOST THERE
Step 3 – Operation of AIG’s Member Buying Group to provide access to cheaper pricing for independent stores in the NT – A NEW APPROACH
While AIG was unsuccessful in securing ABA funding to commence the Member Buying Group in 2022, we are now undertaking a broader approach to achieving our goal. This includes discussions with other buying groups in Australia to ascertain their appetite for operating in the NT, while continuing to engage with independent remote community stores across the seven northern regions to better understand their needs and wants.
Why is AIG’s store and pricing model so successful?
We have proven our store management model works, having developed a social enterprise community store model that focuses on social outcomes over profits while maintaining the business viability of the store.
At the heart of the model is a pricing philosophy that encourages healthy choices through prices.
We use a three-tier pricing guide:
- Mob’s Choice Range: one of our more successful solutions to food security, our Mob’s Choice Range includes heavily discounted essentials and indicates good value for money.
- Healthier items: margins and markups lowered = cost the customer less, e.g. our fruit, vegetables and meat are sold at cost price in community
- Non-essential, unhealthier items: increase the markup = more expensive
Our ability to obtain the best possible supplier prices is made possible by:
- Increasing competition in the market by having multiple suppliers
- Supporting the local NT market, and
- Not accepting rebates but rather receiving cheaper product prices.
Continue to watch this space!
