The Government did announce a suite of legislative and policy changes in August last year, with the key change being a carve-out for building consent processes for significant supermarket developments.
The change would make use of the Fast-track Approvals Act for zoning and resource management approvals and to expand central government’s processes for building consents.
According to documents released to the Herald under the Official Information Act, Nicola Willis planned to hold a meeting with members of Tesco’s executive team following the RFI process.
A planned meeting with UK supermarket Tesco did not take place.
The first mention of a planned meeting between Willis, ministry officials and Tesco representatives was on May 8, 2025. Another meeting date with Foodstuffs South Island was also mentioned in this document for May 9, 2025.
The meeting that was set down for June 19 was referred to three times in separate briefing documents to Willis, but was not detailed in later documents.
No record of the meeting is found in Willis’ official ministerial diary either.
In response to questions posed to the minister, a spokesperson said a planned meeting with Tesco did not go ahead “due to personnel changes at Tesco”, and the company had ”opted not to participate in the process”.
Founded in 1919, Tesco is one of the world’s largest retailers, with nearly 5000 stores across the UK, Czechia, Ireland, Slovakia, the Isle of Man and Hungary.
In its latest financial result, Tesco reported total revenue of £63.6 billion ($144b) and a market share in the UK of 28.3%.
Tesco has been approached for comment.
Wishful thinking
Semi-retired consultant and grocery advocate Ernie Newman said he had never believed the premise that new entrants could be coaxed into the New Zealand market.
“No matter how big they may be, they’re going to have to make a massive investment and sustain years and years of losses in order to somehow, sometime, get into a profitable situation,” Newman said.
“My argument all along is that we don’t need more competitors, we don’t need new entry, we just need to break up the consolidation of ownership that we’ve somehow got.”
Newman referenced other experts who had said a new entrant would need somewhere between 120 and 150 new stores across New Zealand, something Newman believes a business case couldn’t be built for.
He agreed it could be a reason Tesco didn’t go ahead with further meetings.
As for whether Willis and the Government had been successful in taking on the supermarket duopoly, Newman was succinct.
“No. I don’t doubt that Nicola Willis has been going around through her officials and talking to a lot of potential entrants. But if they’re all saying no, then she needs to come out and say that, instead of acting as if she’s hoping this whole thing will go away.
“I suspect that there is the expertise within the Commerce Commission to move on some kind of break-up, but they need the Government support to do that, and at this stage the Government has run out of time to do so before the election.”
Attempts quashed
While Tesco was the first major prospective supermarket player planning to meet with the Government, it is not the only one officials tried to contact.
Two other supermarket giants, Aldi and Lidl, were invited to participate in the RFI process but neither opted to do so.
Aldi is a German-founded, global discount supermarket chain with over 12,000 stores across its two main entities, Aldi Nord and Aldi Süd, and global revenue of roughly €110b ($216b).
The chain has a combined global presence that spans Europe, China, the US and Australia, where it holds approximately 11% of the market with roughly 600 stores.
Lidl is the largest of the three grocers that Willis planned to meet, operating around 12,600 stores across Europe, the US and Asia, and reporting roughly €130b in revenue.
Willis acknowledged in August 2025 that Lidl and Aldi had chosen not to participate in the RFI, calling it “disappointing”, but she hoped changes under the fast-track legislation would encourage them to take a more serious look.
According to the documents released, officials attempted to facilitate meetings with both companies, to no avail.
Aldi has confirmed to the Herald that it “currently has no plans to expand into New Zealand”.
Lidl has been approached for comment.
Other findings
Ministry officials noted that 24 groups responded in writing to the RFI, albeit all responses came just before the initial deadline.
Just four days before submissions for the RFI closed on May 12, the Government had received just three responses.
The final responses included five prospective new competitors, 10 existing grocery competitors, three major retailers and their advisers, two advocacy groups (including public advocacy group Northelia) and three technology platform companies.
All names of the companies that submitted were redacted for commercial reasons, but Foodstuffs North and South Island, Woolworths and online grocer Paddock to Pantry are known submitters.
Costco Westgate is the chain’s first New Zealand location, with a second store set to be built in Drury.
Costco and The Warehouse also took part, and are mentioned several times in the official documents, being described as companies with “the best potential to be nationwide competitors quickly”.
Costco is mentioned nine times in a briefing from May 9, with officials noting how the company had already gained 4% market share in Auckland since opening in 2022.
Officials said Costco had told Willis it was interested in opening other stores in New Zealand, and has since announced a second store, to be built in Drury.
The officials said Costco could be a significant competitor in major urban areas because “its stores have a large catchment, meaning it could probably reach a large proportion of the population with fewer stores”.
The Warehouse is mentioned four times in the same briefing from May 9, with officials noting the retailer’s strong regional presence with 88 stores nationwide.
Officials met with members of The Warehouse on the same day to discuss the RFI and what the Government could do to help them expand their grocery offering to better compete with the incumbents.
The Warehouse declined to comment on its submission.
The Warehouse has long been thought of as a potential competitor to the supermarket duopoly, largely because of its large count of established stores. Photo / Jason Oxenham
One potential new competitor is The Food Warehouse.
Owned by parent company Iceland Foods Group, The Food Warehouse is one of the fastest-growing supermarkets in the UK.
Iceland Foods was founded in 1970 and has grown to over 900 stores throughout the UK, with a further 40 owned or franchised stores across Europe. In comparison, The Food Warehouse has just over 150.
Willis held a half-hour-long meeting with members of The Food Warehouse’s team on September 23.
Willis’ office could not confirm whether The Food Warehouse had submitted to the RFI.
The Food Warehouse has been approached for comment.
Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.
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