Why Woolies & Coles aren't price gouging

1. 2024 isn't going to be pretty for small business

2. Why I feel sorry for Woolies and Coles

3. AUKUS v JAUKUS v JAUKUSC

4. A hot new investible asset class: avatars of old rock bands

THIS WEEK'S BIG STORY

Why Qantas' $120 million revamp of its Frequent Flyer programme is a great idea ... for Qantas

The Qantas loyalty program is the biggest in the country, and the carrier wants to earn $1 billion a year from it by 2030. Passengers accrue points across the economy, and then banks and the like pay Qantas when they are used for flights. But the programme's earnings are going the wrong way, and customers are frustrated with not being able to use their points.

WHAT IS QANTAS DOING?

The national carrier is creating a new tier for frequent fliers - Classic Plus. It will be available from July for international flights and at the end of the year for domestic flights. It is the first major overhaul of the programme since 2019 and, like airfares, the number of points needed to travel will depend on the time and date of flights.

WHY THE CHANGE?

Yes. There are about 200 billion points issued every year, and they are impossible to spend. What's the point of a point, if you can't cash it in? Qantas knows it's not about the number of points. It's about the availability of flights. And this is why it's a great idea for Qantas. Make flights more expensive but enable customers to spend their points. Qantas rakes in the cash from partners. Customers are happier.

DO CUSTOMERS WIN?

Not really. Simply put: you will need more points to take many of the flights on offer. The good news is there's 20 million more seats added - about four times the current offering. But they are more expensive, in terms of points. It also adds a layer of confusion, to what is already a pretty confusing progamme. We all love it and care about our "status", and compare levels with each other, but I still find it difficult to understand the progamme.

DOES QANTAS WIN?

BEST OF THE WEEK

IF YOU MISSED THIS GUEST, CATCH-UP NOW

Sally Auld, Chief Investment Officer at JBWere, explains why Bitcoin and gold have boomed at the same time - despite being at opposite ends of the risk spectrum.

CALL IT FOR WHAT IT IS

BEST SOCIAL CALLOUT 

Ross, via TikTok on whether the EV bubble has burst:

"I hope so. Hybrids are the real solution for Australia. Different vehicles in different places for different reasons."

GOT A HOT TOPIC?

You made it to the end! Thank you for reading.

- Sean Aylmer

There's a world of pain coming for small business, the lifeblood of the economy. The ATO has warned that it's chasing unpaid tax and superannuation bills, and small businesses owe the vast majority of the $50 billion outstanding. The banks are also staying tough on small business loans, according to the Reserve Bank. And insolvency practitioners are warning that a bunch of companies are struggling to stay afloat. Throw in high interest rates and a slowing economy, and small business is in for a rough year.  

It's easy to hate the supermarkets. But are they really price gouging? Coles boss Leah Weckert says the supermarket makes around $2.60 for every $100 a customer spends. And that hasn't changed in five years. It doesn't sound like price gouging. Compare it to the oil and gas companies, or the big miners, when commodity prices soar. And I don't buy the lack of competition argument either - Coles, Woolworths, Aldi, Costco, IGA, online etc. I agree that suppliers might need help, since many are beholden to the big retailers. But messing with the market, and forcing rules on supermarkets, won't result in better outcomes for customers. 

The Financial Times has sifted through medical research papers to come up with nine household foods for a healthier life. And they are: Avocados are good for weight control. Heart health is helped by an apple a day. Wholegrains – think quinoa, rye, oats and buckwheat - aid gut health. A glass of milk fights fatigue and boosts fertility. Leafy greens can slow brain ageing. A handful of nuts lowers the risk of respiratory disease and cancer. Olive oil helps you live longer while multi-vitamins help memory muscles. And yoghurt can help blood pressure and blood sugar control. 

Over the past week, Pophouse, part owned by former Abba member Bjorn Ulvaeus, paid $US300 million for the name, image and likeness of glam rock band Kiss. Pophouse wants to create live music shows using Kiss avatars. (It has already done it for Abba.) It wants to licence Kiss songs to streaming services and Hollywood. Pophouse considers the "Kiss world" an investible asset. A couple of years ago it acquired Cyndi Lauper's music catalogue for the same reason. Years ago there were Bowie bonds, where David Bowie borrowed money backed by future royalties. Pophouse is doing something similar - creating an investible asset from music. 

The big political story of the week is the rush to join the AUKUS pact between Australia, the UK and the USA. US President Joe Biden is holding talks with Japanese PM Fumio Kishida this week, and it emerged that the founding members want to invite Japan into the group, to help ward off Chinese aggression. Then Canadian PM Justin Trudeau said he wants in. AUKUS emerged after Australia promised to pay $368 billion for a bunch of nuclear powered submarines. In all the excitement over another multi-lateral pact, let's not forget that for Australia, it should be about the delivery of submarines.  

5. Nine foods for a healthy life