GAGGING for Fairly Priced Groceries

Ive been absent from blogging on this site for a while, but for a good reason. Ive been preoccupied helping to set up the Grocery Action Group, or GAG - a consumer-centric group dedicated to breaking up our broken grocery market and restoring fair grocery prices in a competitive market as we used to enjoy in earlier times.

Way back I did a 4 year stint running what was then the NZ Grocery Manufacturers Association, an industry group comprising grocery suppliers, which went on to morph into the NZ Food and Grocery Council. In those days New Zeland had about six major grocery chains - Foodstuffs. Foodtown, Shoprite, Three Guys, Woolworths and a couple of minnows. They genuinely competed against each other to buy their goods at the best price from suppliers and sell them at the best bargain rates to customers. If the wholesalers got too greedy the manufacturer would get in their truck and sell product store by store. Competition at its very best, in a market that reflected New Zealand's status as a world class food bowl.

Fast forward to 2024. Our grocery distribution market is broken. We have only two chains - Foodstuffs and Woolworths. Just two CEOs in Auckland decide how much Kiwis pay for our groceries. Margins have gone through the roof - many PaknSave owners are the richest people in town! Ranges have reduced. Suppliers, including embryonic artisan food producers, have been forced out of business. Manufacturers brands have been forced out of the market by house brands owned by the retailers. Deliberate confusion is used as a marketing tool to de-sensitise consumers to what constitutes a fair price. The industry has become a playground for creative marketers hell-bent on maximising the profits of the supermarket empires regardless of the impact on suppliers and customers.

The retailers have expanded into adjacent markets such as delicatessen, butchery, bakery, liquor, pharmaceuticals and petrol. The concentration is frightening and a national impediment to our standard of living.

Thats why we've set up the Grocery Action Group. Im proud to be a part of a small but extremely experienced Board under the leaderhip of veteran consumer advocate Sue Chetwin. We want to restore competition to this essential market. Its a daunting task but we're up to it!

Keep an eye on www.gag.nz to track our progress.