One sweet treat, two different prices: Why are Aussie-made goods cheaper across the sea?

We heard claims of Coles selling sub-standard items... Now, Woolworths has entered the picture thanks to this shopper's sighting... abroad?

When a New Zealand-based shopper spotted Australian-made Cadbury blocks selling for less than they do at home, they didn't realise that it could reshape Australia's grocery landscape.

Yet, that's precisely what happened!

The chocolate that started it all

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A frustrated shopper posted about Woolworths' pricing difference online, all while the federal government unveils strict new laws to crack down on supermarket price gouging.

The customer's discovery was genuinely shocking. A 180g block of Cadbury chocolate made in Australia, were selling at Pak'n'Save for NZ$2.69 on special. Meanwhile, the same blocks sold in Woolworths Australia would cost $4.50, even on 'special' pricing.

'How the heck can they justify that?' the frustrated shopper wrote on a post online. The ACCC found that Australia's major supermarkets are among the most profitable in the world.

Yet, Australian shoppers are paying significantly more for products made in their own backyard.

New laws with real bite

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On Monday, 20 October, the Federal Government released an exposure draft of legislation to prohibit excessive pricing by supermarkets, with fines of up to $10 million for major supermarket chains that engage in these practices.

The legislation targeting companies like Coles and Woolworths isn't just symbolic. Supermarket businesses with turnover above $30 billion will be required to keep track of prices, costs and other factors affecting grocery sales, creating a paper trail that regulators can scrutinise.

Courts will judge excessive pricing using information such as the cost of supply, a reasonable markup, or comparisons with prices in competitive jurisdictions.

The cross-border pricing puzzle

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The Cadbury case isn't an isolated issue. Another Aussie fave, Tim Tams, face the same pricing paradox. These treats are made in Australia, but are cheaper when bought in New Zealand.

'What's made here in NZ is usually cheaper to buy in Aussie,' a shopper pointed out.

Australian consumers are effectively subsidising cheaper prices overseas for their own products, while paying premium prices at home where competition is limited.

Woolworths explained the difference by citing factors such as different tax arrangements, variations in purchase volumes, and varying promotional pricing activities.

International lessons and local hope

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The legislation is based on models in the United Kingdom and the European Union, where similar frameworks have provided consumer protection without stifling competition. These international examples suggest it's possible to balance fair pricing with business viability.

When Australian-made products consistently cost less overseas than at home, it suggests market failure rather than natural pricing forces.

Industry pushback and expert debate

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However, not everyone agrees that price gouging is the culprit.

The Australian Retailers Association stated that the price gouging plan will do little to encourage new entrants capable of challenging the big two supermarkets. It could also likely add more red tape to businesses.

On the other hand, some economists argued that it is a case of misplaced focus.

The rising costs of supermarket goods are primarily due to the increasing input costs of supermarkets, including fuel, freight, wholesale goods, and wages. Laws against price gouging would be unlikely to impact grocery prices unless these costs are addressed.

A Senate report found what many customers have long believed—Australia's big supermarkets engage in price gouging, directly contradicting industry claims.

The legislation represents the most significant intervention in supermarket pricing in Australian history.

The ACCC found that there are substantial barriers to entry in the supermarket sector and that Coles and Woolworths have limited incentives to compete on price.

This discussion is particularly important for seniors living on fixed incomes.

The cost of groceries has become one of the most significant financial pressures facing older Australians, with many reportedly cutting back on household essentials to manage their budgets.

The new laws won't immediately reduce prices, but they create a framework for accountability that hasn't existed before.

Your voice in the process

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The Cadbury chocolate case has become an unlikely symbol of a much larger conversation about fairness, competition, and the cost of living in Australia.

The exposure draft legislation is open for submissions until Monday, 3 November. This is an opportunity for consumers like you to directly influence laws that will affect your weekly shop.

The consultation process means your experiences with pricing can inform the final legislation.

Whether the new laws will actually reduce grocery bills remains to be seen. What's clear is that the days of unchecked pricing power may be numbered.

Have you noticed that Australian products are often sold at a lower price overseas? What other pricing practices at the big supermarkets have left you scratching your head? Share your experiences and insights with us in the comments below.