Commerce Commission supermarket report.

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MurrayM

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#2884162 10-Mar-2022 10:07

trig42:

Something the commission could have done was forced them to divest some sites. There are many examples of a Countdown over the road from a Countdown because previously one of them was a Woolworths or Foodtown. Pretty sure that St Lukes mall had a Countdown at each end for a while.

The Glenfield Mall was like this for several years, two Countdowns within a 1 minute walk of each other. Fortunately one of them is now a Briscoes.

insane

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#2884166 10-Mar-2022 10:14

marmel: ..I think if Labour get a third term and there hasn’t been some real action from the companies involved we may see more invasive measures taken.

marmel:

..Labour have already said they may go beyond what the CC have recommended if there is no sign of progress which actually leads to lower grocery prices however I suspect this will take a few years to monitor and see the trends.

You have a nice pair of rose tinted glasses on. I fully believe there will be more years of monitoring the situation as you say from all sides, with no one capable or willing to do anything meaningful about it.

And because of that, I think the we'd be better off pouring $$ into investment / innovation / funding in startups or businesses in that sector, or just supporting through using them. There are a few online bulk buying options, but they lack range and could do with a re-imagined buying experience to allow that to become mainstream. I'm okay if they don't do fresh produce to begin with - there are actually already a few local seasonal online vegetable options such as foodtogether.co.nz

quickymart

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#2900722 13-Apr-2022 08:46

https://thespinoff.co.nz/business/13-04-2022/the-pros-and-cons-of-getting-your-groceries-delivered-from-australia

MikeAqua

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#2900758 13-Apr-2022 09:24

The commerce commission are the organisation who allowed the duopoly to be created in 2001 (decision 238). One of the commissioners, who made that decision: Dame Paula Rebstock.

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Kyanar

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#2901833 13-Apr-2022 11:47

trig42:

Yep, 2011 the last Foodtown was rebranded as a Countdown.

About the same time, Countdown (Progressive) absorbed Woolworths/Big Fresh as well.

Who absorbed 3 Guys? Progressive as well?

Something the commission could have done was forced them to divest some sites. There are many examples of a Countdown over the road from a Countdown because previously one of them was a Woolworths or Foodtown. Pretty sure that St Lukes mall had a Countdown at each end for a while.

As I have previously been reminded, Progressive Enterprises no longer exists. It has adopted the name of it's Australian parent, and is now Woolworths New Zealand. I suspect that they kept the Countdown name as it had better brand recognition than Woolworths to NZ consumers.

tripper1000

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#2901852 13-Apr-2022 11:52

This enquiry, and other such as the fuel prices enquiry, are just a political way of momentarily passing the political buck and kicking the can down the road. It gets the media off their backs for 12 months, and then when the report comes back, most people have forgotten.

The fact that this tactic still works after all these years and that the constituency hasn't wised up yet, just means this tactic moves up the list of options in the political play book. Other distraction tactics include (re)starting a pointless debate or even a referendum on a pointless but mildly divisive topic, such as changing the flag or becoming a republic.

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Geektastic

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#2901870 13-Apr-2022 12:18

"Food price increases were widespread in the year ended March 2022 with increases in all categories measured by Stats NZ.

Grocery food prices increased 6.7 per cent, fruit and vegetable prices increased 18 per cent, and restaurant and ready-to-eat food prices increased 5.1 per cent."

- Stuff today.

"I was lucky enough to have a holiday overseas recently, and a trip to a local supermarket reminded me of how cheap food can be in a big, competitive market like the UK.

Celery was 90c a bunch, croissants $2 for a pack of eight, and 12 free-range eggs $4. A recent article comparing 10 basic foods showed the cost was 50 per cent higher than in the UK.

And it’s not just food. A phone package with 40 gigabytes of data, unlimited calls and texts was $15 a month.

On a stopover in Calgary, locals were moaning about fuel at NZ$1.80 a litre. And while Calgary has the same population as Auckland, you can buy a very well-built four-bedroom, three-bathroomhome in the equivalent of Auckland’s Grey Lynn for NZ$800,000.

In Australia, a two-year mortgage from a major bank is 3.1 per cent – but the same bank charges 5.15 per cent for the equivalent mortgage over here.

So what is going on? Why is New Zealand so expensive?"

Stuff yesterday.

Regulation of the grocery market is overdue because competition does not work in such a small market with no land borders to make import easy (unlike, say, Switzerland).

Exactly HOW they regulate I do not know. It is hard to see a way that does not make it like Ronald Reagan's favourite Russian joke:

"A man walks into a Moscow shop. He looks around at the empty shelves and says "I see you have no bread."

The assistant replies "No, Comrade. We have no fish. The shop with no bread is next door."

mattwnz

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#2901951 13-Apr-2022 14:23

MikeAqua:

The commerce commission are the organisation who allowed the duopoly to be created in 2001 (decision 238).

Wasn't Foodtown sold in the mid 90's? I just seem to remember this all happening when I was at school, but I do remember tat experts warned that it would reduce competition and consumers risked paying higher prices, but this was defended. There doesn't' seem to be any accountability.

mattwnz

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#2901952 13-Apr-2022 14:25

I see that the warehouse appear to be getting back into groceries as a result of the current situation. Milk and butter and some other essentials were advertised as really cheap. But the problem is a lack of supply, as they had sold out when we went to the store.

mattwnz

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#2901953 13-Apr-2022 14:28

Jas777:

mattwnz: The thing is that food is an essential service and kiwis have been over paying for a couple of decades since Foodtown was allowed to merge,so there needs to be done immediate changes. I just wonder how much this has ended up costing the economy. I remember they used this argument when there was a telco monopoly leading to the unbundled. Removing GST on food could make an immediate effect to at least make food cheaper if they want to make an immediate change but that may only bring prices back to pre covid. I am surprised there isn't more outrage. However I have noticed more people inside the supermarket complaining about the prices. Food in the UK is much cheaper but they have real competition, but that didn't used to be the case and when I lived over there food was more expensive than NZ.

If you drop GST then you will have to raise personnel income taxes

The UK also has 15 times the population.

They do have more competition but a lot is smaller competitors who carry less lines. Not sure if that can work in NZ due to supply issues and customer mindset. I think a lot of people here think more competition will be another one with the same size stores.

The real problem though is the margins that supermarkets are making on each food item. For example, the warehouse is selling a block of 500gm Tararua butter of $4. Previously it was $5 when not on special. But on of the big two supermarket chains sell it for $7.30 as the normal price. That is a huge difference in price. Not only that but food is increasing by more than the inflation level. Maybe they are trying to make hay while the sun is still shining, as they know changes are coming.

But the fact is that NZers are paying far too much for food. Everyone knows it and we have known this for years, but noone has actually made any changes to do anything about it.

stevenz

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#2902226 14-Apr-2022 09:25

The government seems to be actively avoiding trying to rectify any of the current issues to the point of denying they even exist (and then partially back-pedalling), and I'd be very interested in knowing why.

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#2902281 14-Apr-2022 10:25

stevenz:
The government seems to be actively avoiding trying to rectify any of the current issues to the point of denying they even exist (and then partially back-pedalling), and I'd be very interested in knowing why.

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#2903134 16-Apr-2022 23:35

stevenz:
The government seems to be actively avoiding trying to rectify any of the current issues to the point of denying they even exist (and then partially back-pedalling), and I'd be very interested in knowing why.

- If they acknowledge them they face the possibility of being blamed for it.

- if they attempt to do anything now, it'll leave nothing to promise voters come election time.

- Is it really a problem when GST takings would be at record levels.

- Creates greater reliance on the govt, ideological alignment.

- Have no idea how to actually begin to tackle them.

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