There were tell-tale signs that Coles and Woolworths were flexing too much muscle in pressuring suppliers to ramp up their production but without the corresponding benefits.

According to the Australian Competition and Consumer Commission (ACCC), information provided so far by a number of suppliers, which the federal agency has yet to identify, suggested that the two giant retailers were employing bully tactics in dealing with grocery suppliers.

ACCC chief Rod Sims confirmed on Monday that big name suppliers have come forward complaining that Coles and Woolworths have been resorting to 'unconscionable conducts' in waging their fierce pricing competition.

In the process, however, suppliers were the ones caught in the middle of the retail conflicts that saw prices of basic grocery items plunging to near non-profitable levels.

In an interview with BusinessDay, Sims revealed that data so far furnished by affected suppliers indicated that undue pressures were being applied on them by the two dominant supermarket chains, which to date rule over some 70 percent of the local grocery industry.

"We have had some suppliers and companies approach us with information, and we are encouraged by the response so far," the watchdog chief told the publication on Monday.

The suppliers, Sims said, were apparently buoyed by ACCC's assurance that it will address the valid concerns that will be aired by their side and protect their interest too when necessary.

Sims said suppliers have lamented of dwindling profits, which they directly attributed to both policies enforced by Coles and Woolworths, plus the undue pressure that they need to increase their output in order to meet the two firms' increasing supply demands, the main reason of which is their ongoing price war.

Also, brand name suppliers have complained that the giant retailers were slowly killing supplier products by offering 'home brands' on their shelves with high discounts, leaving other brands in the bottom lists of shoppers.

The ACCC has suggested that cases can be filed against Coles and Woolworths but credible information is required for the prosecution to stand, a part that the grocery suppliers can definitely provide, Sims said.

In February, Sims called on parties concerned to take part in the gathering of evidence against the dominant retailers for the ACCC to be able to muster a solid case for prosecution, with focus of likely wrongdoings over the past six to nine months.

The industry's main concern right now is the proliferation of 'home brands' coming from both Coles and Woolworths and presumably supplied by 'small' suppliers, which Goldman Sachs said recently could cost big name suppliers some $4.5 billion in sales losses.

That in turn will be channelled directly to the coffers of Coles and Woolworths, which have been accused too of forcing their suppliers to significantly reduce delivery prices.

BusinessDay said that Woolworths alone had amassed $3.6 billion in half-year sales by December mainly on the account of its in-house beer, wine and liquor products, achieving a 13 percent sales surge in the period.