Weetbix increasingly scarce at The Warehouse?

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#3214733 5-Apr-2024 17:15

MichaelNZ:

Additionally, while imposing a minimum retail price is technically illegal doesn't mean it doesn't happen. If The Warehouse persistently undercuts considerably larger clients they could find themselves on the outer. Price setting is very common its just called something different.

Price setting of minimum prices is not "technically" illegal. It is a criminal offence to be in a cartel in New Zealand and manipulate pricing.

MichaelNZ

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#3214747 5-Apr-2024 17:22

Handle9:

Price setting of minimum prices is not "technically" illegal. It is a criminal offence to be in a cartel in New Zealand and manipulate pricing.

Commerce Act 1986

Restrictive trade practices

https://legislation.govt.nz/act/public/1986/0005/latest/DLM88263.html

Resale price maintenance by suppliers prohibited

https://legislation.govt.nz/act/public/1986/0005/latest/DLM88289.html

Resale price maintenance by others prohibited

https://legislation.govt.nz/act/public/1986/0005/latest/DLM88295.html

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Handle9

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#3214748 5-Apr-2024 17:27

MichaelNZ:

Handle9:

Price setting of minimum prices is not "technically" illegal. It is a criminal offence to be in a cartel in New Zealand and manipulate pricing.

Commerce Act 1986

Restrictive trade practices

https://legislation.govt.nz/act/public/1986/0005/latest/DLM88263.html

Resale price maintenance by suppliers prohibited

https://legislation.govt.nz/act/public/1986/0005/latest/DLM88289.html

Resale price maintenance by others prohibited

https://legislation.govt.nz/act/public/1986/0005/latest/DLM88295.html

This was criminalised in 2019 by the Commerce (Criminalisation of Cartels) Amendment Act 2019.

Saying it's "technically" illegal is trivialising an extremely serious offence.

mattwnz

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#3214758 5-Apr-2024 17:53

MichaelNZ:

michaelmurfy:

There is some history behind that: https://www.newshub.co.nz/home/money/2023/10/sanitarium-backtracks-on-decision-to-cut-off-the-warehouse-s-weet-bix-supply.html

In Sanitarium's position I would have done exactly the same thing.

The Warehouse has no loyalty and will copy products in an instant if they think customers will buy the house brand made in China version. And then drop the product they copied because its their model to only have a minimal range based around house brands.

Additionally, while imposing a minimum retail price is technically illegal doesn't mean it doesn't happen. If The Warehouse persistently undercuts considerably larger clients they could find themselves on the outer. Price setting is very common its just called something different.

So if there is a shortage may as well supply the favoured clients. Just like any business would.

The major difference here is that NZ lacks competition in this sector. NZ has a clear duopoly and NZers are paying more for groceries as a result. That is a fact shown by the commerce commission report. TWH is trying to bring in more competition. Consumers are able to now pay a lot less for some of the products that the TWH is selling. If NZ consumers can save $, $2, $3 + per item, then that is a big saving per week. Some supermarkets brands under the big 2 duopoly, do charge a significant % more than others anyway.

I remember back in the 90's when I travelled to the UK, food was a lot more expensive than it was in NZ, even factoring in the exchange rate differences back then. Now it seems to be the reverse, and that is thanks to new companies like Lidl and Aldi shaking up the market. NZ also seems to pay quite a lot more than they do in Oz for the same products. Although competition in Oz is also not good and people have been making the same sorts of complaints over there with a lack of competition. But it isn't just increased prices, but shrinkflation, where sizes are decreased, but prices are also increased.

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#3214770 5-Apr-2024 18:36

MichaelNZ: The Warehouse has no loyalty and will copy products in an instant if they think customers will buy the house brand made in China version.

Does The Warehouse stock an alternative Weetbix product?

stagnant16

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#3214775 5-Apr-2024 18:56

All rhetoric aside for a moment!

"Our analysis shows that profit to sales margins for New Zealand’s major grocery retailers are
broadly consistent with the sample of overseas grocery retailers"

mattwnz

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#3214780 5-Apr-2024 19:34

stagnant16:

All rhetoric aside for a moment!

"Our analysis shows that profit to sales margins for New Zealand’s major grocery retailers are
broadly consistent with the sample of overseas grocery retailers"

And this

"However, it is difficult to draw firm conclusions regarding whether the major grocery retailers’ profit margins are consistent with workable competition by comparing them with overseas grocery retailers"

"While it is difficult to compare grocery prices internationally accurately, it appears that New Zealand prices are relatively high by international standards"

"New Zealand was the fifth most expensive grocery market in the OECD in 2017, when comparing prices using a combination of market exchange rates (66% weighting) and PPPs (34% weighting). "

They are using very old data.

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stagnant16

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#3214786 5-Apr-2024 20:08

But according to you, we're being ripped off left, right, and centre—yet an official enquiry couldn't conclusively determine either way!

Nothing further to add!

mattwnz

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#3214789 5-Apr-2024 20:15

stagnant16:

But according to you, we're being ripped off left, right, and centre—yet an official enquiry couldn't conclusively determine either way!

Nothing further to add!

It's very difficult for them when current data doesn't really exist to draw a conclusion. Especially when these are private companies and the data isn't public.

Zigg

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#3215034 6-Apr-2024 11:28

gzt:
MichaelNZ: The Warehouse has no loyalty and will copy products in an instant if they think customers will buy the house brand made in China version.

Does The Warehouse stock an alternative Weetbix product?

Wasn't a small Brit shop forced to stop selling Weetabix a while back?

gzt

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#3215059 6-Apr-2024 13:49

Countdown has a generic product 1kg - $4.95. Looks like they have leverage:

https://www.countdown.co.nz/shop/productdetails?stockcode=584288&store=9221

gzt

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#3215060 6-Apr-2024 13:52

Zigg: Wasn't a small Brit shop forced to stop selling Weetabix a while back?

It is allowed if the seller covers part of the Weetabix product packaging apparently. Google says it's still sold here.

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#3215091 6-Apr-2024 15:35

gzt: Countdown has a generic product 1kg - $4.95. Looks like they have leverage:

https://www.countdown.co.nz/shop/productdetails?stockcode=584288&store=9221

Sanitarium doesn't care, they still get paid. I can bet you dollars to donuts that box came out of a Sanitarium factory. Same as Aldi "weety brix" or whatever they call them over here do.

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#3215092 6-Apr-2024 15:36

gzt:
It is allowed if the seller covers part of the Weetabix product packaging apparently. Google says it's still sold here.

Same as UK Marmite. Apparently it's popular enough with the brit ex-pats that in Australia it's imported branded as Our Mate. Not sure if NZ also stocks it.

MikeAqua

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#3215439 8-Apr-2024 08:49

Kyanar:

gzt:
It is allowed if the seller covers part of the Weetabix product packaging apparently. Google says it's still sold here.

Same as UK Marmite. Apparently it's popular enough with the brit ex-pats that in Australia it's imported branded as Our Mate. Not sure if NZ also stocks it.

My local countdown has UK marmite in the international section. I tried some once. It tastes like it contains more salt than salt does.

Mike

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