When Prime Minister Anthony Albanese discovered that Tim Tams were selling for less in an Abu Dhabi supermarket than back home in Australia, it perfectly captured what many of us have long suspected—we're paying too much for our groceries.
During his stopover in the United Arab Emirates, Albanese didn't just sample the cheaper biscuits—he extended a formal invitation to the region's largest hypermarket chain, Lulu, to set up shop in Australia.
It's a bold move that could potentially shake up a grocery sector that has left many Australian seniors feeling they're being taken for a ride.
Lulu Group International is a UAE-based multinational conglomerate that operates one of Asia's largest retail chains, with 259 outlets across the Gulf Cooperation Council countries and beyond.
Founded in 1989 by Indian businessman M.A. Yusuff Ali, who hails from Kerala, the company has built an impressive track record of successful international expansion.
What makes Lulu particularly interesting for Australian consumers is their existing relationship with our producers.
Yusuff Ali first visited Australia in September 1983 to source premium lamb and meat, establishing a trade relationship that has grown stronger over decades, with Lulu now playing a key role in supplying Australian food products to retailers across Asia and the Gulf.
Meet the retail giant that caught the PM's eye
'We need more competition in the Australian supermarket sector'
The timing couldn't be more strategic. The Australia-UAE free trade agreement entered into force on Wednesday, removing tariffs between the two countries, with two-way goods and services trade worth $9.9 billion in 2023.
Australia's grocery duopoly problem
To understand why the PM is courting international retailers, you need to grasp just how concentrated our supermarket sector has become.
As of 2023, over 80 per cent of Australia's grocery retailer market share sits with the top four companies, with around 65 per cent of the market attributable to Woolworths and Coles alone.
Australia's supermarket market share breakdown
Woolworths: 38 per cent
Coles: 29 per cent
ALDI: 9 per cent
Metcash (IGA): 7 per cent
The remaining players split just 17 per cent of the market between them
In economic terms, this is an oligopolistic market structure in which Coles and Woolworths have limited incentive to compete vigorously with each other on price.
A survey by the Australia Institute's Centre for Future Work revealed 83 per cent of Australians blamed the supermarkets for high grocery prices, with Coles and Woolworths considered 'public enemy No.1' as Australians grapple with soaring cost of living.
The invisible barriers keeping competitors out
So why haven't more international chains successfully entered Australia? The challenges are more significant than you might expect. Other grocers have attempted to enter Australia, including Germany's Kaufland chain, which abandoned expansion plans in 2020 after reportedly investing as much as $500 million.
One of the most concerning barriers is something called 'land banking.' Lulu may face issues entering the Australian market due to land banking, where supermarkets strategically purchase sites to prevent competitors from setting up shop.
The ACCC previously found 165 blocks of land were potentially being hoarded by the major supermarkets, with two-thirds held by Woolworths, 42 by Coles and 13 by Aldi.
The issue is the deep pockets required to establish a distribution and retail network, and then it invariably takes some time, according to Deputy ACCC Commissioner Mick Keogh.
What this could mean for your weekly shop
For Australian seniors managing tight household budgets, increased competition could provide much-needed relief. If Lulu moves ahead with entering Australia, the effects could be significant, with greater price competition potentially mounting pressure on Coles and Woolworths to cut markups, especially on fresh produce, meat and staples.
Potential benefits of Lulu entering Australia
- Greater price competition on everyday essentials
- More choice and innovation in store formats
- New export opportunities for Australian farmers
- Improved supply chain efficiencies across the sector
- Pressure on existing chains to improve customer service
Lulu could introduce new store formats, private labels or imported goods that aren't widely available currently, while their existing infrastructure in the Middle East and Asia could create new export paths for Australian agricultural, dairy and food manufacturers.
The company's experience with Australian products is already evident in their Middle Eastern operations. Recent festival promotions at Lulu stores showcase major product lines directly imported from Australia, including fresh meat, organic food, muesli bars, plant-based milk, sauce, cake mix, honey, grocery items, fresh fruits and vegetables.
The reality check
Before getting too excited about potential savings, it's worth tempering expectations. Despite the government's enthusiasm, Lulu's journey into Australia has encountered significant obstacles, with the Australian retail landscape dominated by established players like Coles and Woolworths, making it challenging for new entrants to gain a foothold.
Even if the invitation is serious, Lulu's Australian entry is unlikely to be smooth, with hurdles including high operating costs and scale requirements, as Australia's retail real estate and logistics costs are steep, particularly in populous states, with new entrants often needing strong capital backing to endure the early years.
The company would also need to navigate complex regulatory requirements and supply chain logistics across Australia's vast distances—challenges that have proven difficult for previous international entrants.
Government pressure mounting
The invitation to Lulu comes as the Albanese government faces increasing pressure to address grocery prices. The Australian Prime Minister has committed to inflict severe penalties on any supermarkets caught price gouging, with a taskforce being formed comprising various stakeholders including the ACCC and Treasury, targeting legislation implementation by the end of 2025.
This follows a challenging year for major supermarkets facing price gouging allegations, with Woolworths and Coles bearing the brunt as they're accused of effectively functioning as an oligopoly, while the ACCC recently concluded inquiry hearings with a verdict awaited.
The long game
While no concrete timeline has been announced for Lulu's potential Australian expansion, the invitation represents a significant diplomatic and economic signal.
One of Lulu's advantages is their scale and experience across multinational markets and different countries, giving them the capital and expertise, but success will depend on whether the government helps from a regulatory perspective.
For Australian consumers, particularly seniors on fixed incomes, any genuine increase in competition would be welcome news.
The question isn't whether we need more choice in our grocery shopping—nearly two-thirds of voters see increased supermarket competition as crucial for alleviating cost-of-living pressures, with Australians now demanding action with the same urgency as they're calling for lower utility costs and higher wages.
Did you know?
Did you know?
Australia is the only nation on earth with a continent all to itself, requiring large-scale logistics capabilities for national grocery chains. This geographic reality, combined with Australia not having the population to support a third national grocery chain, naturally favours the two major incumbents.
The real question is whether Lulu—or any international retailer—can overcome the structural barriers that have kept Australia's grocery sector locked in what many describe as an unhealthy duopoly.
What's your experience with grocery prices in recent years? Have you noticed significant increases in your weekly shop, and would you welcome a new major competitor to shake things up? Share your thoughts in the comments below.
Original Article
https://www.news.com.au/finance/bus...bf7f465e8b06fadc23dd70063b1495?from=rss-basic
PM invites foreign hypermarket to take on Coles and Woolies
Cited text: Prime Minister Anthony Albanese has invited an Arab hypermarket giant to take on Coles and Woolworths in Australia. Albanese confirmed he had asked th...
Excerpt: During his stopover in the United Arab Emirates, Albanese didn't just sample the cheaper biscuits—he extended a formal invitation to the region's largest hypermarket chain, Lulu, to set up shop in Australia
https://www.thenewdaily.com.au/news/2025/09/30/albanese-lulu-hypermarket
LuLu Group International—Wikipedia
Cited text: LuLu Group International is a UAE based multinational conglomerate company that operates a chain of hypermarkets and retail companies, headquartered i...
Excerpt: Lulu Group International is a UAE-based multinational conglomerate that operates one of Asia's largest retail chains, with 259 outlets across the Gulf Cooperation Council countries and beyond
https://en.wikipedia.org/wiki/LuLu_Group_International
LuLu Group International—Wikipedia
Cited text: It is one of the largest retail chains in Asia and is the biggest in the Middle East with 259 outlets in the Gulf Cooperation Council (GCC) countries ...
Excerpt: Lulu Group International is a UAE-based multinational conglomerate that operates one of Asia's largest retail chains, with 259 outlets across the Gulf Cooperation Council countries and beyond
https://en.wikipedia.org/wiki/LuLu_Group_International
LuLu Group International—Wikipedia
Cited text: Lulu Group India Head Quarters is located in Kochi, India It was founded in 1989 by M. A. Yusuff Ali from Nattika in Kerala, India.
Excerpt: Founded in 1989 by Indian businessman M.A. Yusuff Ali, who hails from Kerala
https://en.wikipedia.org/wiki/LuLu_Group_International
Australia-UAE Trade: PM Albanese Visits Lulu Hypermarket in Abu Dhabi | Khaleej Times
Cited text: He also recalled his first visit to Australia on September 8, 1983, when he began sourcing premium lamb and meat for Lulu Hypermarkets in the UAE, a t...
Excerpt: Yusuff Ali first visited Australia in September 1983 to source premium lamb and meat, establishing a trade relationship that has grown stronger over decades, with Lulu now playing a key role in supplying Australian food products to…
https://www.khaleejtimes.com/kt-net...dhabi-showcasing-stronger-trade-ties-with-uae
Albanese invites Arab 'hypermarket' to compete with Coles and Woolworths | SBS News
Cited text: A free trade deal between Australia and the UAE will enter into force on Wednesday, removing tariffs between the two countries. The UAE is one of the ...
Excerpt: The Australia-UAE free trade agreement entered into force on Wednesday, removing tariffs between the two countries, with two-way goods and services trade worth $9.9 billion in 2023
https://www.sbs.com.au/news/article/albanese-courts-middle-eastern-supermarket-giant/fr23o8co1
Supermarkets and grocery retail in Australia—statistics & facts | Statista
Cited text: As of 2023, over 80 percent of Australia’s grocery retailer market share sits with the top four companies, with around 65 percent of the market attrib...
Excerpt: As of 2023, over 80 per cent of Australia's grocery retailer market share sits with the top four companies, with around 65 per cent of the market attributable to Woolworths and Coles alone
https://www.statista.com/topics/6399/supermarkets-and-grocery-retail-in-australia/
Australia supermarket report: More grocery competition needed to break ‘oligopoly’ but barriers may be too high
Cited text: One of the main findings of this report was the conclusion that the local supermarket industry is ‘highly concentrated’, with the ACCC putting Woolwor...
Excerpt: Woolworths: 38 per cent | Coles: 29 per cent | ALDI: 9 per cent | Metcash (IGA): 7 per cent
https://www.foodnavigator-asia.com/...break-oligopoly-but-barriers-may-be-too-high/
Australia supermarket report: More grocery competition needed to break ‘oligopoly’ but barriers may be too high
Cited text: “In economic terms, this is an oligopolistic market structure in which Coles and Woolworths have limited incentive to compete vigorously with each oth...
Excerpt: In economic terms, this is an oligopolistic market structure in which Coles and Woolworths have limited incentive to compete vigorously with each other on price
https://www.foodnavigator-asia.com/...break-oligopoly-but-barriers-may-be-too-high/
PM invites foreign hypermarket to take on Coles and Woolies
Cited text: Supermarket giants Coles and Woolworths are considered “public enemy No.1” as Australians grapple with the soaring the cost of living. A survey by the...
Excerpt: A survey by the Australia Institute's Centre for Future Work revealed 83 per cent of Australians blamed the supermarkets for high grocery prices, with Coles and Woolworths considered 'public enemy No…
https://www.thenewdaily.com.au/news/2025/09/30/albanese-lulu-hypermarket
Major issue standing in the way of LuLu Hypermarket entering Australia to challenge Coles, Woolworths: 'Harder'
Cited text: Other grocers have attempted to enter Australia, including Germany’s Kaufland chain, which abandoned expansion plans in 2020 after reportedly investin...
Excerpt: Other grocers have attempted to enter Australia, including Germany's Kaufland chain, which abandoned expansion plans in 2020 after reportedly investing as much as $500 million
https://au.finance.yahoo.com/news/m...llenge-coles-woolworths-harder-041324216.html
Major issue standing in the way of LuLu Hypermarket entering Australia to challenge Coles, Woolworths: 'Harder'
Cited text: Garg said LuLu may face issues entering the Australian market due to 'land banking', where supermarkets strategically purchase sites to prevent compet...
Excerpt: Lulu may face issues entering the Australian market due to land banking, where supermarkets strategically purchase sites to prevent competitors from setting up shop.
https://au.finance.yahoo.com/news/m...llenge-coles-woolworths-harder-041324216.html
Major issue standing in the way of LuLu Hypermarket entering Australia to challenge Coles, Woolworths: 'Harder'
Cited text: “The issue is the deep pockets to establish a distribution and retail network and then it invariably takes some time,” Keogh told ABC News Radio.
Excerpt: The issue is the deep pockets required to establish a distribution and retail network, and then it invariably takes some time
https://au.finance.yahoo.com/news/m...llenge-coles-woolworths-harder-041324216.html
Lulu supermarket Australia entry: Albanese urges UAE giant to challenge Coles & Woolworths
Cited text: One article even notes “a major issue standing in the way of Lulu Hypermarket entering Australia to challenge Coles & Woolworths harder.” · If Lulu mo...
Excerpt: If Lulu moves ahead with entering Australia, the effects could be significant, with greater price competition potentially mounting pressure on Coles and Woolworths to cut markups, especially on fresh produce, meat and staples
https://theabj.com.au/2025/09/30/lulu-supermarket-australia-entry/
Lulu supermarket Australia entry: Albanese urges UAE giant to challenge Coles & Woolworths
Cited text: Lulu could introduce new store formats, private labels or imported goods that aren’t widely available currently.
Excerpt: Lulu could introduce new store formats, private labels or imported goods that aren't widely available currently, while their existing infrastructure in the Middle East and Asia could create new export paths for Australian agricultural,…
https://theabj.com.au/2025/09/30/lulu-supermarket-australia-entry/
Lulu supermarket Australia entry: Albanese urges UAE giant to challenge Coles & Woolworths
Cited text: Lulu’s existing infrastructure in the Middle East and Asia could create new export paths for Australian agricultural, dairy and food manufacturers.
Excerpt: Lulu could introduce new store formats, private labels or imported goods that aren't widely available currently, while their existing infrastructure in the Middle East and Asia could create new export paths for Australian agricultural,…
https://theabj.com.au/2025/09/30/lulu-supermarket-australia-entry/
Lulu Group launches ‘Explore Australia’ Festival at all hypermarkets | The Peninsula Qatar
Cited text: Now we have almost all ranges of Australian products, which have become integral part of Lulu’s offerings.” · The festival is showcasing the major pro...
Excerpt: Recent festival promotions at Lulu stores showcase major product lines directly imported from Australia, including fresh meat, organic food, muesli bars, plant-based milk, sauce, cake mix, honey, grocery items, fresh fruits and vegetables
https://thepeninsulaqatar.com/artic...xplore-australia-festival-at-all-hypermarkets
LuLu Hypermarket Faces Major Setback in Australia Expansion | Meyka
Cited text: However, despite the government’s enthusiasm, LuLu’s journey into Australia has encountered significant obstacles. The Australian retail landscape is ...
Excerpt: Despite the government's enthusiasm, Lulu's journey into Australia has encountered significant obstacles, with the Australian retail landscape dominated by established players like Coles and Woolworths, making it challenging for new…
https://meyka.com/blog/lulu-hypermarket-faces-major-setback-in-australia-expansion/
Lulu supermarket Australia entry: Albanese urges UAE giant to challenge Coles & Woolworths
Cited text: Even if the invitation is serious, Lulu supermarket Australia entry is unlikely to be smooth.
Excerpt: Even if the invitation is serious, Lulu's Australian entry is unlikely to be smooth, with hurdles including high operating costs and scale requirements, as Australia's retail real estate and logistics costs are steep, particularly in…
https://theabj.com.au/2025/09/30/lulu-supermarket-australia-entry/
Lulu supermarket Australia entry: Albanese urges UAE giant to challenge Coles & Woolworths
Cited text: Australia’s retail real estate and logistics costs are steep, particularly in populous states. New entrants often need strong capital backing to endur...
Excerpt: Even if the invitation is serious, Lulu's Australian entry is unlikely to be smooth, with hurdles including high operating costs and scale requirements, as Australia's retail real estate and logistics costs are steep, particularly in…
https://theabj.com.au/2025/09/30/lulu-supermarket-australia-entry/
Australia supermarket report: More grocery competition needed to break ‘oligopoly’ but barriers may be too high
Cited text: The Australian Prime Minister has committed to inflict severe penalties on any supermarkets caught price gouging, but has not identified any definitio...
Excerpt: The Australian Prime Minister has committed to inflict severe penalties on any supermarkets caught price gouging, with a taskforce being formed comprising various stakeholders including the ACCC and Treasury, targeting legislation…
https://www.foodnavigator-asia.com/...break-oligopoly-but-barriers-may-be-too-high/
Australian Aisle Wars: The cost of investigation
Cited text: Last year has been a trying year for major supermarkets in Australia as some of them have been facing price gouging allegations made in 2023. Woolwort...
Excerpt: This follows a challenging year for major supermarkets facing price gouging allegations, with Woolworths and Coles bearing the brunt as they're accused of effectively functioning as an oligopoly, while the ACCC recently concluded inquiry…
https://business.yougov.com/content/51688-australian-aisle-wars-the-cost-of-investigation
Major issue standing in the way of LuLu Hypermarket entering Australia to challenge Coles, Woolworths: 'Harder'
Cited text: “With LuLu, one of the advantages is they are as huge as they are. So if they decide to enter, they have this experience across multinational markets ...
Excerpt: One of Lulu's advantages is their scale and experience across multinational markets and different countries, giving them the capital and expertise, but success will depend on whether the government helps from a regulatory perspective
https://au.finance.yahoo.com/news/m...llenge-coles-woolworths-harder-041324216.html
PM invites foreign hypermarket to take on Coles and Woolies
Cited text: “The public’s appetite for increased supermarket competition is unmistakable,” senior researcher and report co-author Lisa Heap said. “Nearly two-thir...
Excerpt: nearly two-thirds of voters see increased supermarket competition as crucial for alleviating cost-of-living pressures, with Australians now demanding action with the same urgency as they're calling for lower utility costs and higher wages
https://www.thenewdaily.com.au/news/2025/09/30/albanese-lulu-hypermarket
Woolworths Dominates with Market Share, Unstoppable Growth
Cited text: Australia is the only nation on earth with a continent all to itself and so large-scale logistics and distribution capabilities are key infrastructure...
Excerpt: Australia is the only nation on earth with a continent all to itself, requiring large-scale logistics capabilities for national grocery chains.
https://kosec.com.au/woolworths-powers-ahead-with-dominant-37-market-share-and-bold-fy25-outlook/
Woolworths Dominates with Market Share, Unstoppable Growth
Cited text: The combination of these factors, plus the fact that Australia doesn’t have the population to support a third national grocery chain, favour the two m...
Excerpt: Australia is the only nation on earth with a continent all to itself, requiring large-scale logistics capabilities for national grocery chains.
https://kosec.com.au/woolworths-powers-ahead-with-dominant-37-market-share-and-bold-fy25-outlook/
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