{"id":611958,"date":"2026-09-26T02:06:09","date_gmt":"2026-09-26T02:06:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/611958\/"},"modified":"2026-09-26T02:06:09","modified_gmt":"2026-09-26T02:06:09","slug":"foodstuffs-breakup-plan-why-nationals-supermarket-policy-is-a-disaster-bruce-cotterill","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/611958\/","title":{"rendered":"Foodstuffs breakup plan: Why National\u2019s supermarket policy is a disaster \u2013 Bruce Cotterill"},"content":{"rendered":"

Across town, the competitor is Woolworths<\/a>. Their corporate structure means that stores are owned by the company, a company that has, over many years, changed names and ownership. You\u2019ll remember the name Progressive Enterprises and brands including Countdown, Big Fresh, Super Value and 3 Guys. In 2023, everything changed back to Woolworths.<\/p>\n

These two organisations had a market share in the NZ grocery industry of 82% five years ago, a number which has since shrunk to 78%. The Government, and Finance Minister Willis in particular, who continues to quote the five-year-old number, think that\u2019s too high. She\u2019s been trying to woo new entrants from overseas to come into our market and shake things up a bit.<\/p>\n

Why would she do that? Well, because we love to talk about the fact that we have a cost of living crisis, and grocery costs are a part of that. Mind you, so too are electricity prices, local authority rates, insurance, petrol costs and, although not included in the CPI basket, mortgage interest rates.<\/p>\n

But our politicians aren\u2019t interested in having a go at that stuff. It\u2019s the grocers they\u2019re after.<\/p>\n

In fact, if you\u2019ve been listening closely to the campaign dribble over the last few weeks, you\u2019d be forgiven for thinking that all of the nation\u2019s problems are the fault of our grocers. In a way, the various attacks on supermarkets have become convenient \u2013 overlooking the real problems we have with health, infrastructure, productivity, government spending, our accumulating debt mountain and all the other things our politicians should be focused on.<\/p>\n

But no, let\u2019s give it to the grocers instead! Labour, the Greens, NZ First and surprisingly National<\/a>, are all having a go at the supermarket industry\u2019s expense.<\/p>\n

The Greens\u2019 desire to nationalise 120 supermarkets<\/a> is ill-informed communistic nonsense that will never see the light of day.<\/p>\n

Labour\u2019s plan<\/a> to separate the ownership of the distribution channels from the retailers is equally silly. There\u2019s a reason it\u2019s not done anywhere else in the world. It doesn\u2019t work with 60,000 stock units, 530 stores and a country with 11,000km of state highways.<\/p>\n

Then there\u2019s the National Party plan to break up Foodstuffs, a 104-year-old New Zealand icon.<\/p>\n

I grew up in a Foodstuffs family. My dad was a grocer. My brother is a grocer and so is my nephew. I spent eight years of school and university holidays working in the company\u2019s warehouses, preparing orders, loading and unloading trucks and later, installing state-of-the-art IBM computer systems in the 1980s.<\/p>\n

So I understand the business. And I understand the company well.<\/p>\n

That said, I don\u2019t feel that I owe Foodstuffs a defence in their current dispute with the Government. They\u2019re not perfect. I\u2019ve dealt with them many times and often come away bruised or frustrated.<\/p>\n

But personal experiences aside, the current attacks by various political parties on our supermarket industry are, in my opinion, a disgrace; a word I do not use lightly.<\/p>\n

\"FinanceFinance and Economic Growth Minister Nicola Willis during her announcement on supermarkets in her Beehive office. Photo \/ Mark Mitchell<\/p>\n

The various policies being trotted out by the politicians highlight one thing. They have no understanding of the business. This column has no desire to discuss the fairyland thinking of Labour or the Greens.<\/p>\n

But let\u2019s consider the new National Party policy. In case you missed it, they intend to ask the Commerce Commission to review the Foodstuffs organisation<\/a>, with a view to demanding that they split their very successful business of 104 years\u2019 standing into two separately owned and operated companies.<\/p>\n

Many of us, myself included, were quick to condemn former PM Jacinda Ardern when she made her \u201ccaptain\u2019s call\u201d to disable the oil and gas industry in this country.<\/p>\n

This is no different. There is no consultation, no public analysis and certainly no evidence to suggest that such moves will result in lower grocery prices. I don\u2019t know where the savings are expected to come from when you establish two distribution channels, two IT systems and two executive structures instead of one. Not to mention five years of legal fees that will inevitably follow.<\/p>\n

Their desire is to have three competing organisations rather than two, and since they\u2019ve failed to attract another international player, they thought they\u2019d split up a Kiwi icon instead.<\/p>\n

The most amazing thing about this policy is how \u201canti-National\u201d it is. Herald political reporter Audrey Young called it \u201cNational\u2019s hard turn left\u201d<\/a>. The Prime Minister, who I like, is fond of talking about aspiration and helping to make New Zealanders wealthier.<\/p>\n

The National Party itself was founded on values that include the following words: \u201c\u2026 to maintain freedom of contract; to encourage private enterprise; to safeguard individual rights and the privilege of ownership; to oppose interference by the State in business, and State control of industry.\u201d<\/p>\n

And yet they launch a policy that is a direct attack on one of the most successful business stories in New Zealand history.<\/p>\n

So what happens next? Does the Government charge Giltrap with selling too many cars and force them out of some dealerships? Perhaps Mainfreight needs to sell down half its fleet because they\u2019re too successful. Or try telling Les Mills that there are too many Kiwis going to their gyms and force them to sell a few off. Perhaps we should even up the lopsided Bledisloe Cup by having the Government force the rugby union to give half of our players to Australia.<\/p>\n

Sound ridiculous? It does. Because it is.<\/p>\n

The search for a major new supermarket entrant has been well publicised. It\u2019s not new. It\u2019s been tried before and failed. Willis has tried and failed<\/a>. There are plenty of reasons, some of which have been well documented. We\u2019re a small nation. When it comes to major industries, we don\u2019t often have room for more than a couple of major players. It\u2019s also a difficult market to cover geographically. We\u2019re long and narrow, meaning distribution is complex and expensive.<\/p>\n

There\u2019s another reason that new players find it difficult. New Zealand supermarkets are among the best in the world. They are among the cleanest. Fresh food presentation of meat, fruit and vegetables is regarded as the best anywhere. Survey house Roy Morgan recently reviewed New World stores as having 83% customer satisfaction in this country. It\u2019s a better score than any other supermarket in a customer satisfaction survey anywhere.<\/p>\n

\"Price-wise,Price-wise, Pak’nSave rates well against Aldi.<\/p>\n

So we hear this talk of our Government trying to entice Aldi from Europe or Walmart from the US. I\u2019ve visited several supermarkets in both Europe and North America in the last two years. They\u2019re awful by comparison. And besides, their pricing is higher than what we have. A Foodstuffs basket of goods comparison between Pak\u2019nSave, Aldi and Tesco showed the Kiwi store was consistently 5 to 8% cheaper than the international stores.<\/p>\n

So they\u2019re no cheaper and they\u2019re not good enough. They won\u2019t come here because they\u2019ll get hammered in the first 12 months.<\/p>\n

That is, unless the Government smashes up the market leader and makes it easy for a new international player. Surely they wouldn\u2019t do that? Don\u2019t bet on it.<\/p>\n

Not only is the policy anti-business, it\u2019s also anti-Kiwi. That\u2019s what hurts the most. Why smash up the local firm but leave the massive Australian-owned Woolworths, the most expensive in the market, untouched? The team at Woolies must be laughing. Speaking of such, the big four Australian-owned banks took $9.5 billion in profits out of New Zealand in the last financial year. They\u2019ve taken $45b in the past five years. Where\u2019s the action on that?<\/p>\n

Could it be that our politicians need to stay on the right side of our cross-ditch cousins in order to secure their post-political board careers with the big Aussie banks and corporates? Nothing would surprise me anymore.<\/p>\n

It\u2019s fair to say that the Government have been giving the supermarket operators a hard time about pricing for a while now. But it\u2019s equally fair to say that the supermarkets have responded.<\/p>\n

For the 12 months to June 2026, our headline inflation was 4.1% but food price inflation was just 1.9%. Foodstuffs says that its retail prices were just 1.5% up for the year, despite suppliers charging an additional 2.9%. The difference is being absorbed by the company and its store owners.<\/p>\n

We should keep in mind that those numbers include every product delivery with diesel-powered vehicles costing 45.8% more to fill up than they did a year ago.<\/p>\n

So it would seem that Willis gave them a serve and they got the message. I know for a fact that the efforts to continue to drive down prices continue within Foodstuffs. It\u2019s a never-ending quest. It always has been. They\u2019re not getting much credit for it, though.<\/p>\n

The most un-National Party aspect of this is the impact on the small business. Many of us will have seen the flurry of Facebook messages from the owners of those Four Square stores over the last couple of weeks. Mums and dads with young families, working six or seven days a week, trying to get ahead while providing an essential service to local communities.<\/p>\n

\" Kobe Kerr, Sharlene Foote, Ben Kerr and Kane Kerr. Four Square Coopers Beach. Photo \/ Supplied<\/p>\n

Foodstuffs has 119 family-owned stores servicing communities of 5000 people or less. Those stores provide the product range and pricing that they do because they are part of a buying group that gets better deals through volumes generated by bigger stores in bigger towns. They also get logistics off the back of those bigger stores.<\/p>\n

The Four Square store in Tekapo gets its deliveries from a truck heading to Pak\u2019nSave in W\u0101naka or Queenstown. The Four Square store in Murupara gets a price for sugar or flour because the group buys so much of it. It\u2019s called economies of scale.<\/p>\n

I\u2019ve heard the arguments about Foodstuffs being tough on suppliers. So is The Warehouse. So is Fletcher Building. That\u2019s how it works. The more you buy, the better the deal.<\/p>\n

There\u2019s something else those mums and dads running small stores get on the back of their co-operative. Banking. Do our politicians really think that owners can get funding for their store purchase and their stock finance by virtue of the security their tiny store offers? Of course they can\u2019t. They get funded because of the mammoth machine that sits behind them and guarantees their performance. Take that away and guess what. More small business failures. The only difference being that we can blame this one on the Government, not the operator.<\/p>\n

Those Facebook posts also told us that these stores are not just grocery stores. Like rugby clubs and the local gym, they\u2019re central hubs in our communities. They\u2019re places where 35,000 people work and thousands more connect.<\/p>\n

I know of an immigrant family that came to New Zealand with nothing eight years ago. The parents work in the local Pak\u2019nSave. They took every overtime hour on offer and bought their first home in just seven years.<\/p>\n

These businesses also underwrite the charitable efforts in their local neighbourhoods. The schools, rugby clubs and surf lifesaving clubs. The young motor racer with a dream and the School Board chair who needs an operation in Australia.<\/p>\n

Audrey Young called it a left turn. It\u2019s more like a U-turn. Readers can probably tell that this writer is disappointed. This policy is anti-Kiwi and contrary to the values of the National Party. It\u2019s anti-small business, and it\u2019s anti-aspirational success. Worst of all, it picks on one small segment of our society while leaving many others, including the internationals, untouched.<\/p>\n

If you want to get stuck into the supermarkets, get into all of them, not just the New Zealand-owned guys who are easier to beat up.<\/p>\n

And while you\u2019re at it, get into the other industries causing cost of living pressure. Our Government has more control over energy companies and fuel prices than they do over any private Kiwi success story. Get them to cut their cloth. The Aussie banks walk away with their bags of gold untouched. Why should we let that happen?<\/p>\n

The National Party would do well to reflect on the values under which it was founded.<\/p>\n

After all, that\u2019s what I thought they stood for.<\/p>\n

Bruce Cotterill is a professional director, speaker and adviser to business leaders. He is the author of the book, The Best Leaders Don\u2019t Shout, and host of the podcast, Leaders Getting Coffee. www.brucecotterill.com<\/a><\/p>\n

Catch up on the debates that dominated the week by signing up to our Opinion newsletter<\/a> \u2013 a weekly round-up of our best commentary.<\/p>\n","protected":false},"excerpt":{"rendered":"Across town, the competitor is Woolworths. Their corporate structure means that stores are owned by the company, a…\n","protected":false},"author":2,"featured_media":611959,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[198197,1558,4057,95809,795,138,15308,20440,3381,5111,20385,48803,51410,20209,162121,58925,3011,301442,3218,185,302,6187,39084,30706,3025,71084,111,139,69,286018,2170,7254,29544,45341,10505,2735,97,1361,6436,4276,102,80],"class_list":["post-611958","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-apron","tag-been","tag-behind","tag-breakup","tag-bruce","tag-business","tag-charlie","tag-cheeky","tag-complete","tag-convenient","tag-cotterill","tag-disaster","tag-ear","tag-entire","tag-excellent","tag-foodstuffs","tag-four","tag-grocers","tag-icon","tag-is","tag-its","tag-lives","tag-location","tag-logo","tag-most","tag-nationals","tag-new-zealand","tag-newzealand","tag-nz","tag-pencil","tag-plan","tag-policy","tag-range","tag-served","tag-square","tag-store","tag-supermarket","tag-that","tag-well","tag-why","tag-with","tag-zealand"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/611958","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=611958"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/611958\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/611959"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=611958"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=611958"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=611958"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}