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The Reject Shop to become Dollarama| Rokt & roll for an IPO | ACCC after Aldi's veggie cartels · What the Flux

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  Speaker 1: This is what the flex I'm brand. I'm justin and Wednesday,
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  Speaker 1: the third of September.
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  Speaker 2: Jusey Boyd, the Trump family just made about five billion
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  Speaker 2: US dollars in paper wealth after its new digital currency
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  Speaker 2: WLFI aka World Liberty Financial launched publicly, kind of the
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  Speaker 2: equivalent of an IPO for digital currencies. And boy of course,
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  Speaker 2: this follows the trump Mean coin that launched in jam
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  Speaker 2: this year and then the Millennia coin as well, both
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  Speaker 2: of which have plummeted in price since.
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  Speaker 1: Trumpet his family are getting that bag. The man they are.
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  Speaker 1: Much of producers are getting that bag as well because
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  Speaker 1: there is a major global much of shortage, and we
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  Speaker 1: have done an awesome deep dive in the Flex app
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  Speaker 1: talking about why there's been such a huge increase in
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  Speaker 1: demand for mature, why there's a shortage, and where it's
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  Speaker 1: going to go from here. So if you want to
• 0:48
  Speaker 1: learn more about the global much of shortage may shut
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  Speaker 1: download the Flex app and check out the video.
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  Speaker 2: Three gigantic stories today, Juzzy boy Let's do it for
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  Speaker 2: our first. The Reject Shop is planning to rebrand its
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  Speaker 2: stores into Dollarama stores as it pushes towards becoming a
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  Speaker 2: super low priced retailer.
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  Speaker 1: Wasn't it already kind of low price? Hallou can you do? Yeah?
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  Speaker 1: Tell me what's going on here?
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  Speaker 2: So the Reject Shop started in Melbourne in nineteen eighty
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  Speaker 2: one as a retailer that sold discontinued lines of products
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  Speaker 2: and factory rejects.
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  Speaker 1: But over the years it's become a lot more than
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  Speaker 1: just rejects.
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  Speaker 2: It sells everything from snacks to party hats, to health
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  Speaker 2: foods and cleaning supplies.
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  Speaker 1: But beman, from late twenty thirteen to early twenty twenty five,
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  Speaker 1: the Reject shops share price had plummeted more than eighty
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  Speaker 1: three percent.
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  Speaker 2: So in July this year, Dollarama announced his acquisition of
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  Speaker 2: the Reject Shop for two hundred and fifty nine million dollars.
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  Speaker 1: Man, if you're wondering who Dollarma is, that is the
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  Speaker 1: nearly fifty eight billion dollar Canadian discounting behavior which has
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  Speaker 1: a nothing of a five dollar promise.
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  Speaker 2: Yep, it literally has nothing in store over five bucks.
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  Speaker 1: And now the Reject Shop's new corporate overlord has revealed
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  Speaker 1: its plans for a full scale transformation of the Reject Shop.
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  Speaker 2: The Reject Shop's iconic name will eventually disappear and it
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  Speaker 2: will be replaced by Dollarama branding and.
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  Speaker 1: The Dollarma crew. It planted double the Australian store count
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  Speaker 1: to seven hundred by twenty thirty four.
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  Speaker 2: They're also planning to leverage dollar Arma's massive supply chain
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  Speaker 2: to flight Australian stores with ultra cheap products.
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  Speaker 1: And they man they're certainly trying to disrupt the market
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  Speaker 1: with some price leadership.
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  Speaker 2: So what is the key learning here?
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  Speaker 1: Price leadership is most commonly when a company uses lower
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  Speaker 1: pricing to reshape an industry.
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  Speaker 2: It forces competitors to either follow suit or risk losing
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  Speaker 2: market chare.
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  Speaker 1: In Australia, We've seen Audi pull out the price leadership
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  Speaker 1: against Coles and Woolies over the past two decades.
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  Speaker 2: And of course I've seen Kmart do this to Big
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  Speaker 2: W and ironically the Rejac shop too.
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  Speaker 1: But now the Region Shop with its Dollarma might is
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  Speaker 1: pulling out the unu reverse cards Kmart.
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  Speaker 2: The danger for incumbents is that they can't always match
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  Speaker 2: those prices without crushing their own margins. The goal for
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  Speaker 2: dollar Ama would be to push out weaker players from
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  Speaker 2: the market.
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  Speaker 1: We know that Big W is already struggling after it's
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  Speaker 1: thirty five million dollar loss for the last financial year.
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  Speaker 2: So this price leadership is about resetting customer expectations for
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  Speaker 2: what cheap actually looks like.
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  Speaker 1: The real discount war has only just begun. Your move
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  Speaker 1: next Kmart For our second story.
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  Speaker 2: Rocked, the Aussie tech company, has been revalued by its
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  Speaker 2: major investors to over seven billion dollars as it ramps
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  Speaker 2: up towards a potential IPO.
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  Speaker 1: Good Old Rocked aka the backstage crew of online shopping
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  Speaker 1: tell me more.
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  Speaker 2: So Rocked that is rokt is an Australian e commerce
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  Speaker 2: software company that was founded by the former jet Star
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  Speaker 2: CEO in twenty fourteen.
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  Speaker 1: That's a website pop up that let's advertisers get exposure
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  Speaker 1: to new customers via the partner websites.
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  Speaker 2: So for example, if you purchase a flight with Jetstar
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  Speaker 2: to Sydney.
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  Speaker 1: Then boom rock slides in with as what a ca Hi,
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  Speaker 1: how about a hotel deal?
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  Speaker 2: Or what about a Hello fresh box that you may
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  Speaker 2: never use but you'll forget to cancel?
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  Speaker 1: And the man Rocked has been hugely successful because it
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  Speaker 1: knows that the customer's buying intention is very high at
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  Speaker 1: that moment of purchase.
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  Speaker 2: The old credit card is already out in about and.
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  Speaker 1: Clearly it seems to be working because Rock has seen
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  Speaker 1: its revenue jump forty percent over the past twelve months
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  Speaker 1: to five hundred million US dollars last year, and.
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  Speaker 2: Now two of Rock's major investors have marked up the
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  Speaker 2: value of their Rock stakes by over twenty eight percentile.
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  Speaker 1: Yep, we're talking a markup from five point six billion
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  Speaker 1: dollars to seven zo point two.
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  Speaker 2: Bill and Juziboy. There are now whispers that a US
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  Speaker 2: IPO is on the cards for Rock.
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  Speaker 1: This year, especially after Figma's high profile and very successful float.
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  Speaker 2: So what is the key learning here?
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  Speaker 1: Going public isn't just about being ready, It's that whether
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  Speaker 1: the market is receptive.
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  Speaker 2: This is often referred to as the IPO window.
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  Speaker 1: That's when investor appetite for growth stocks is hot and
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  Speaker 1: companies rush to list.
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  Speaker 2: Think the IPO boom of twenty twenty one when two
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  Speaker 2: hundred and four companies listed on the ASX.
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  Speaker 1: Compare that to twenty twenty four when just twenty nine
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  Speaker 1: companies listed on the ASEX.
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  Speaker 2: And Jazi boy. When market sentiments softens, IPO floats get shelved.
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  Speaker 1: For example, Rocked actually paused its IPO plans in twenty
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  Speaker 1: twenty two when tech valuations drop.
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  Speaker 2: But Figma's enormous debut earlier this year has shown that
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  Speaker 2: demand might be warming up again.
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  Speaker 1: So for founders and investors, missing the IPO window can
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  Speaker 1: mean years of waiting or listing at a discount, so
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  Speaker 1: it's unlikely that rockt will miss its IPO window this time.
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  Speaker 2: Are out for our third and final story. Out These
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  Speaker 2: vegetable suppliers are facing court action over alleged price fixing.
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  Speaker 1: An Aussi veggie cartel allegedly ganging up on Audi here,
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  Speaker 1: so tell me more well.
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  Speaker 2: Audi is the German supermarket chain that was founded in
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  Speaker 2: nineteen forty six.
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  Speaker 1: And first opened in Australia in two thousand and one,
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  Speaker 1: but now has nearly six hundred.
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  Speaker 2: Stores and Jesse boy. It quickly became popular for its
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  Speaker 2: low pricing and weekly special buyers.
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  Speaker 1: Yep, the only grocery store where you can pick up
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  Speaker 1: your potatoes and a Plarty's machine in the same shop.
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  Speaker 2: But now the a Triple C is investigating four of
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  Speaker 2: Audi's veggie suppliers and what would that before be mad
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  Speaker 2: well for allegedly working together to fix the prices of
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  Speaker 2: broccoli cauliflower, iceberg, lettuce, and other veggies that are sold
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  Speaker 2: to Audi. The A Triple C claims price fixing happened
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  Speaker 2: in AUDI stores across three different states between twenty eighteen
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  Speaker 2: and twenty twenty four, where these four veggie suppliers privately
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  Speaker 2: agreed to submit the same price for their produce.
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  Speaker 1: Instead of competing with one another, Bear and Square.
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  Speaker 2: And this is a big no no, no, no no
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  Speaker 2: in the A Triple C's eyes.
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  Speaker 1: So the accused businesses could face fines of up to
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  Speaker 1: fifty million dollars if they're found guilty after the investigation.
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  Speaker 2: Razy, So what is the key learning here?
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  Speaker 1: Price fixing is the idea the businesses who are supposed
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  Speaker 1: to be competing with each other secretly agreed to set
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  Speaker 1: the same prices for their products.
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  Speaker 2: Instead of letting the market decide.
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  Speaker 1: And this is considered anti competitive behavior because companies are
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  Speaker 1: supposed to compete in a free market.
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  Speaker 2: Competition leads to low prices, better quality products and services,
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  Speaker 2: more choices for the en buyer.
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  Speaker 1: So when so called competitors fix their pricing, it means
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  Speaker 1: there's no real competition, so customers end up paying more
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  Speaker 1: than they should. Back in two thousand and seven, the
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  Speaker 1: atriple C investigated Australian paper recyclub Visy engaging in price
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  Speaker 1: fixing behavior with its competitor am core.
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  Speaker 2: Visy was found guilty and find thirty six million bucks
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  Speaker 2: for its anti competitive behavior.
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  Speaker 1: So, whether it's paper or produce, the atriple C is
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  Speaker 1: not letting companies go lightly bluck. Fammucha has become one
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  Speaker 1: of the most popular drinks at cafes all around Australia
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  Speaker 1: and the world, and now it's based in a major
• 6:47
  Speaker 1: global shortage. You want to learn more about why, make
• 6:49
  Speaker 1: sure to download the Flux app and watch our deep
• 6:51
  Speaker 1: dive video.
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  Speaker 2: Thanks for listening and we'll see you on Friday.