Breaking up the supermarket duopoly.

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#3157464 9-Nov-2023 07:13

That's what I thinking of - the Progressive merger/acquisition thing. I think that's when things started going downhill in the supermarket industry here.

Sure, it wasn't great before that, but I remember it being better (and cheaper) than it is now.

Kyanar

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#3158757 13-Nov-2023 02:30

Handle9:

It's a $100 holding company. It may exist just for trademark protection.

Trademark protection requires trademark usage. In 'n Out Burger knows this quite well - that's why they have "pop-up" shows every few years.

No, Aldi clearly has intent.

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#3158758 13-Nov-2023 02:44

Kyanar:
Handle9:

It's a $100 holding company. It may exist just for trademark protection.

Trademark protection requires trademark usage. In 'n Out Burger knows this quite well - that's why they have "pop-up" shows every few years.

No, Aldi clearly has intent.

I don’t think a company with $100 of capital shows any intent past “one day we might want to be in this market.”

Certainly it’s far from clear they have intent to enter the New Zealand market.

quickymart

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#3158804 13-Nov-2023 08:54

https://www.newsroom.co.nz/tough-bargaining-spot-for-overseas-grocery-sweetener >> found this story that looks about Aldi possibly entering the NZ market. It's a little out-of-date now given it was written before the election, but still worth a read. Interesting to see if National will do anything about the current situation.

JimmyH

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#3161386 20-Nov-2023 09:30

ezbee:

Our commerce commission probably flush with Libertarian market ideals allowed this to all happen.
Only having 2 competitors is just as good as having 3 according to said experts. :-)
Market will correct itself by Adam Smiths invisible hand.

At risk of spoiling a good story with the facts, I remember what happened and this isn't true. The Commerce Commission declined Progressive's application to take over Woolworths because of the reduction in competition. This was overturned by the courts because the application had been made before changes to the Commerce Act (which strengthened competition law) had been enacted.

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#3161516 20-Nov-2023 12:15

Thanks for the clarification, I had wondered about that - although it makes me query the point of the Commerce Commission if some company doesn't like what they say, they can just go running off to court and get their decision overturned (if I've read you correctly)?

JimmyH

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#3162131 21-Nov-2023 14:44

Nothing surprising about this. The Commerce Commission, like other government bodies, is a creature of statute and only supposed to act inside the law.

If someone believes that they have acted outside the law, or have made a decision that is inconsistent with the law(s) empowering them, then they can ask a court to review this. If the court agrees, then it can rule appropriately.

And, in general, that's a good thing. Otherwise bureaucrats could ignore the law, and affected people would have no recourse.

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freitasm

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#3171366 13-Dec-2023 11:59

The Commerce Commission is acting! There's a Strongly Worded Letter (TM) out there:

Supermarkets encouraged to come to the party this holiday season with genuinely good prices

New Zealand’s Grocery Commissioner is challenging supermarkets to step up and offer meaningful savings for Kiwi households this Christmas and New Year holiday season, to help address cost-of-living pressures.

Given large increases in food prices over the last two years – which has had a substantial impact on household living costs – Pierre van Heerden says there is a real opportunity for the major players in the $25 billion supermarket sector to “bring some Christmas cheer” to Kiwi consumers by offering genuine and meaningful savings – particularly given those players would benefit from increased consumer spend at this time of year.

Mr van Heerden says he is encouraged by some of the pricing commitments he is seeing promoted in the sector for the Christmas and holiday period but wants to see those backed up with “genuinely good prices”, particularly at times when demand will be highest.

“We know this has been a particularly challenging year for Kiwi consumers with cost-of-living pressures, so I’m asking supermarkets to implement Everyday Low Pricing (EDLP) throughout the holiday season rather than the practice of frequently moving prices up and down – to help ensure Kiwi consumers are getting a genuinely good price when they shop for their groceries.”

Mr van Heerden is also urging supermarkets to ensure that when they do advertise specials or promotions these are accurate and not misleading.

“All retailers have obligations under the Fair Trading Act to ensure that consumers are not misled – all pricing and promotions therefore should be clear, accurate and unambiguous so that consumers can make a well-informed decision.”

Mr van Heerden says he wants supermarkets to become leaders in accurate pricing, given the positive difference this could deliver in terms of cost-of-living for all New Zealanders.

“As one of the largest sectors in New Zealand, supermarkets should lead the way with accurate pricing and value for money. This is a sector that touches every consumer in New Zealand so it’s important they get this right.”

In October this year, the Grocery Commissioner announced that one of his priorities is clear and accurate pricing, with supermarkets being the most complained-about-sector to the Commission and pricing issues being a common reason. The Commission is exploring options to get to the bottom of the pricing issues but is also calling on supermarkets to get the right processes in place now.

Unit Pricing Regulations have also come into effect as of 31 August 2023, which require certain grocery retailers to display the unit price for goods clearly and legibly. It will help Kiwi consumers make informed decisions about the price of the products they buy when grocery shopping, especially where products are sold in different sized packaging and by different brands.

While physical stores must comply by 31 August 2024, Mr van Heerden is encouraging major grocery retailers to start taking steps to consider how this will be implemented, particularly in relation to promotions.

Background
The Grocery Industry Competition Act came into force on 10 July 2023, and gives the Commerce Commission powers to monitor and regulate the grocery sector. The new function headed by the Grocery Commissioner oversees the Grocery Supply Code, which seeks to address the imbalance in power between retailers and suppliers.

The Grocery Industry Competition Act designates Foodstuffs North Island, Foodstuffs South Island, and Woolworths New Zealand as regulated grocery retailers (RGRs). It puts requirements on them to consider requests from other retailers for wholesale supply in good faith, and to follow the Grocery Supply Code in their dealings with suppliers.

These changes are designed to bring more competition to the sector and more transparency to agreements between the RGRs and suppliers, benefiting New Zealand consumers over the long-term. This includes more convenient shopping, more choice and better prices.

Kyanar

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#3171630 14-Dec-2023 00:31

Handle9:

I don’t think a company with $100 of capital shows any intent past “one day we might want to be in this market.”

Certainly it’s far from clear they have intent to enter the New Zealand market.

Did you not read anything I said? Trademarks require actual usage or at least proof of intent to use. If they cannot demonstrate that they have real intent to use those trademarks, in commerce, in the near future, they face revocation. Clearly Aldi intends to enter NZ at the right point. Which legally cannot be "never".

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#3171641 14-Dec-2023 07:37

Not necessarily. A know US burger chain keeps doing pop-up shops in Auckland and Wellington every few months, apparently in a bid to keep their trademark as "in use". But they never mentioned anything about actually establishing a franchise here.

wellygary

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#3171649 14-Dec-2023 09:06

JimmyH:

ezbee:

Our commerce commission probably flush with Libertarian market ideals allowed this to all happen.
Only having 2 competitors is just as good as having 3 according to said experts. :-)
Market will correct itself by Adam Smiths invisible hand.

At risk of spoiling a good story with the facts, I remember what happened and this isn't true. The Commerce Commission declined Progressive's application to take over Woolworths because of the reduction in competition. This was overturned by the courts because the application had been made before changes to the Commerce Act (which strengthened competition law) had been enacted.

But the Court didn't say the merger should go ahead, just that the ComCom needed to use the old test not the new one..

The ComCom eventually approved the transaction ( hence why the merger occurred) see below..

"Commission clears Progessive Enterprises to acquire Woolworths"
https://comcom.govt.nz/news-and-media/media-releases/archive/commission-clears-progessive-enterprises-to-acquire-woolworths

decibel

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#3188127 29-Jan-2024 15:40

We may be out of the frying pan, into the fire.

https://www.reuters.com/business/retail-consumer/australias-woolworths-record-near-1-billion-impairment-2024-2024-01-28/

I haven't seen this in the local media, yet.

gzt

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#3188143 29-Jan-2024 17:34

I had my first Warehouse win yesterday. Cherry tomatoes $2 vs 2x for $6 at the paknsave over the road.

sir1963

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#3198092 20-Feb-2024 21:54

Interesting App

Grocery App.

Installed it on my phone and it allows me to compare prices in local supermarkets.

With Click and collect it may well save us a lot of money this year. Mind you I expect supermarkets to push even harder into "Shop Brands", with probably irregular measures (eg 90g vs 1kg) to make price comparisons even more difficult. Guess it won't take someone long to use AI to cover this road block too though.

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#3198110 20-Feb-2024 23:49

sir1963:

Interesting App

Grocery App.

Installed it on my phone and it allows me to compare prices in local supermarkets.

With Click and collect it may well save us a lot of money this year. Mind you I expect supermarkets to push even harder into "Shop Brands", with probably irregular measures (eg 90g vs 1kg) to make price comparisons even more difficult. Guess it won't take someone long to use AI to cover this road block too though.

its a great app. Also useful for finding which supermarket has a particular item within a brand’s range, and for checking produce prices while at a market.

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