Coles has laid down its defence to painful increases in the cost of groceries, pointing to price rises from suppliers and farmers as a key driver for why Australians are paying more at the check-out.
The supermarket chain said it recognised Australian households were being challenged by cost of living pressures in its submission to a federal Senate inquiry into supermarket prices.
"As one of Australia's largest supermarkets, we take seriously our core role in providing essential goods to Australians," the submission reads.
"We are always looking at ways to deliver value to our customers and are committed to helping lower the cost of living."
A submission by Woolworths to the inquiry has not yet been published.
A separate inquiry led by former competition watchdog boss Allan Fels on Wednesday found big businesses, including the supermarket giants, had exploited their market power in ways that have driven up inflation and hurt households.
Coles submitted that while prices may have increased in its stores, it's not translating to a greater profit for the business, which reported a $1 billion net profit last financial year.
Spending on suppliers was Coles' biggest operational cost last financial year, totalling $32.3 billion out of a sales revenue of $40.5 billion.
The submission details it received an average of over 70 cost increase requests a week from suppliers and farmers in the last two financial years, almost double what they were receiving three years ago.
"Our suppliers are subject to the same cost pressures experienced across households, as well as the domestic and global economies," Coles said in its submission.
"We work constructively with our suppliers on promotional campaigns to offer great value to customers and to limit or defer the impact of supplier cost price increases to keep costs low for customers."
Coles said it was committed to providing value to customers, including through weekly specials, an internal cost reduction program and an investment in automation.
It also said customers are becoming more "value-conscious", and are seeing a growth in people purchasing its Coles Own Brand range of products, as well as shopping in bulk to make their dollar go further.
Coles says wages and energy costs feed into price pain
In the submission, Coles also detailed that energy, labour, logistics and packaging costs have increased by $1.4 billion from 2019 to 2023.
It highlighted almost $600 million of that was a result of increases in employee costs, driven in part by increasing wages.
"Significant increases in global commodity prices have flowed through to Australia and impacted Coles and its suppliers, resulting in the pass-through of increasing input costs to fresh and packaged goods," Coles said.
Seasonal issues and natural disasters have also had a significant impact on fresh produce pricing.
In another submission to the inquiry, the Australasian Meat Industry Employees Union (AMIEU) said the "existence of only two major supermarket retailers in Australia provides real issues with competition, fairness and proper regulation of the grocery industry".
"This continued monopolisation of goods and services has provided corporate Australia with all of the levers to control markets — leaving consumers, farmers, workers and others with no genuine alternative but to participate in the existing system," the submission from AMIEU reads.
"Recently there has been a significant reduction in the price of lamb roasts in supermarkets back to 2013 levels, which is a welcome addition for the community. The price of beef remains very high, and other more novel meats that have continued to gain popularity have surged despite there being no issues of supply and demand."
The Senate inquiry was set up after the Greens claimed the major supermarkets were using global inflation and supply-chain issues as an excuse to charge more for their products than necessary.
Senators will inquire into the pattern of price setting between Coles, Woolworths and other chains, rising supermarket prices, the prevalence of opportunistic pricing and the use of technology and automation to extract cost-savings from consumers and employees.
Retailers, primary producers, experts and academics in market power, competition policy and supply chains were all invited to submit to the inquiry.
Public hearings are expected to be held in the coming weeks before the Senate committee reports back in May.
The ABC has requested Woolworths' submission to the inquiry, but it has not yet been made public.