Supermarket Excess Profit Petition

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#2912178 10-May-2022 10:48

Geektastic:

Agreed. You cannot even walk Milford Track without making an official booking or name your child without State approval. NZ appears to have created the belief in the minds of the population that they are free and able to do as they wish and at the same time regulated everything to the nth degree without anyone complaining. No idea how they achieved that but it is spectacular, if chilling.

You can walk the Milford track whenever you want, with no booking. However, you need to book (and pay for) a bunk in a DOC hut. That makes perfect sense. Are you saying hundreds of people should just rush to the huts and either get first in first serve on the beds, or fight for them or something?

kobiak

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#2912181 10-May-2022 10:52

rb99:

Costco, as in one shop ? Two dominate the market, duopoly more or less equals monopoly

I'm not sure about the rest of NZ, but AKL has main chain supermarkets + warehouse + farro + asian supermarkets + vegies stores + costco

I do shop around for different things at different stores

And again, I dont see how someone could start business in NZ if it's not attractive (profitable)

What I dont really like, farmers market - same products goes to supermarket, right? (well that's what they said) Price at the market is the same or higher at farmers markets :(

helping others at evgenyk.nz

elpenguino

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#2912193 10-May-2022 11:08

Rather than look to the telecom industry for an example, how about banking?

Rather than change a bunch of rules, could the govt directly set up supermarkets = "KiwiMarket".

The government has got the money to do so. Maybe some forced land acquisitions from the land banks of the duopoly - this is in the national interest after all.

Most of the posters in this thread are just like chimpanzees on MDMA, full of feelings of bonhomie, joy, and optimism. Fred99 8/4/21

rb99

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#2912200 10-May-2022 11:16

I realise all this is difficult, but still reckon there should be 3 or 4 biggish players, so there's decent competition, not one week coke is half price at Countdown, the next week its half price at New World. but still have space for smaller players. Also it should be fair, so that farmers get a decent price as well. So the impression I get, true or false ? is farmers get say 10% markup, retailers get 100% markup, and wholesalers, well, I tend to the 100% end. So it should be more even. No I don't know how to solve it.

“The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.” -John Kenneth Galbraith

rb99

Eva888

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#2912201 10-May-2022 11:16

I would be the first person against over reaching state controls but in the case of huge increases in food and produce its time to allow competition into NZ. On principle I won’t buy produce that is over priced. Let it rot on the shelf. Our local countdown a few weeks back had bananas at $4.40 per kg. A corner dairy 3 blocks away was selling them at $1.99. The Saturday market had them at $2.99. Why would I reward Countdown with my custom.

I agree that Warehouse butter may be a loss leader, but...good for them. They also sell cheaper milk and bread. If the supermarkets don’t like it they can drop their prices to match.

If people don’t like that Consumer is advocating more competition and lowering of food prices etc., they simply don’t need to sign the petition.

lxsw20

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#2912203 10-May-2022 11:19

kobiak:

NZ needs to become more attractive to the business.

That's easy, quadruple the population.

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elpenguino

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#2912205 10-May-2022 11:20

Eva888: I would be the first person against over reaching state controls but in the case of huge increases in food and produce its time to allow competition into NZ.

My bolding.

Are you saying there are legal / regulatory limits on new supermarkets or food sellers in NZ?

(Beyond reasonable requirements such as meeting hygiene standards etc.)

Most of the posters in this thread are just like chimpanzees on MDMA, full of feelings of bonhomie, joy, and optimism. Fred99 8/4/21

MikeB4

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#2912207 10-May-2022 11:26

I agree with @Lias we do not need to have more regulation. Aotearoa had moved away from mass government commercial control we do not need to go back there. I believe the supermarket situation is being over dramatised and it all seem like grandstanding to provide a convenient smoke screen to obsure issues we face a nation.

Comparing our market to Australia for example is very flawed given out very different market place. Sydney alone eclipses out market.

Here is a crazy notion, lets give peace a chance.

kobiak

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#2912210 10-May-2022 11:30

lxsw20:

kobiak:

NZ needs to become more attractive to the business.

That's easy, quadruple the population.

or introduce more attractive tax scheme for new market players in certain industry

helping others at evgenyk.nz

Eva888

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#2912213 10-May-2022 11:36

These are Aldi Sydney reductions. The pork mince, sigh...$8.98 per kg

https://www.aldi.com.au/en/groceries/price-reductions/

sen8or

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#2912259 10-May-2022 11:39

We were due to get another supermarket in our town (Lincoln in Canterbury), they had even gone as far as earmarking some land and applying for consent, then the whole NIMBYism kicked in and neighbours protested at the thought of it being located near them and the consent was declined (or withdrawn). End result, still no competition (in whatever limited guise that may be) in a growing town.

Land and land use are certainly one hurdle to other players entering the market.

Economies of scale would be another barrier to entry. You'd have to have fairly long term planning for expansion to set up the supply and logistics needed to run a national supermarket chain and very deep pockets to cover the inevitable losses while gaining traction.

Potential investment viability on groceries would also be discouraging, why invest countless millions of dollars setting up competition against 2 established market players who wouldn't exactly welcome a new competitor with open arms. Sure, it'd be good for the consumers (most likely) whilst they battled it out, but business is business and you'd have to have rocks in your head to think it was feasible. And if your not going to set up and compete at the same level as the existing market leaders, then you won't have much buying power negotiating with the suppliers.

The fact that you can go between the existing two majors on any given week to shop the specials shows that there is competition (in whatever limited guise that may be). That you can choose not to go there for all your food requirements (butchers, green grocers, bakeries, markets etc) also shows that you don't have to keep rewarding the current system. Unfortunately, most people are either too lazy, too time poor or simply too apathetic to change the status quo. We go to the same shops and buy the same items irrespective of what may be available elsewhere. Thats not a lack of competition, thats a lack of consumers forcing changes when they don't like something.

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MikeB4

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#2912268 10-May-2022 12:14

The main change I would like to see is the stopping of land banking and covenants preventing the establishment of stores. Interfering or regulating with profit margins is something that would probably cause more harm that good, for example it may result in less competition if say Woolworths deciding to exit the New Zealand market.

Here is a crazy notion, lets give peace a chance.

lxsw20

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#2912274 10-May-2022 12:38

kobiak:

or introduce more attractive tax scheme for new market players in certain industry

That doesn't change the fact we're a country the size of the UK with half the population of London and to top it off we are right at the far reaches of supply chain.

It's got to make sense for these guys to be filling distribution centers with their wares to then send on to 30+ supermarkets (A made up number). One shop in the main centers of NZ, I don't see how that works. The idea that Aldi or Lidl come here and do the same pricing as Europe, even Australia, I don't see it personally. Then again, I'm far from an expert.

I can see how your idea of a better tax scheme might in courage services industry to setup shop in NZ, but there are only so many people to buy consumer goods.

tdgeek

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#2912281 10-May-2022 13:02

johno1234:

Quick peek at PaknSave v Coles

PaknSave butter 500g is NZ$6.79 for the house brand. Quick look at Coles in AU (not even sure if that's the low cost supermarket there?) shows house brand Coles butter AU$6.00.

Then consider the exchange rate, and no GST on food in AU.

NZ$5.90 + GST here vs NZ$6.60 + no GST there

Our butter is cheaper until you add GST. Despite Australia's economy of scale. And our inflation is double Australia's.

The recent update was 1.8% for last quarter for NZ and 2.0% for the last quarter for AU

Lias

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#2912282 10-May-2022 13:02

MikeB4:

The main change I would like to see is the stopping of land banking and covenants preventing the establishment of stores. Interfering or regulating with profit margins is something that would probably cause more harm that good, for example it may result in less competition if say Woolworths deciding to exit the New Zealand market.

I'm not exactly a fan of the idea but I'm not inherently opposed to profit margins being regulated if it was a blanket thing across all industries, not just targeting one.

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