We’re paying higher prices, specials are confusing and loyalty schemes aren’t delivering overly significant rewards.
Those aren’t just the musings of a frustrated supermarket shopper - but are some of the findings in the Commerce Commission’s first annual grocery report, issued on Wednesday.
Rewards schemes were only giving a return of between 0.71 percent for Flybuys and 0.75 percent for Everyday Rewards.
Between 2007 and 2019, the average weekly spend on grocery food increased 7.3 percent every three years but the latest data showed a leap of 28.9 percent.
The commission’s report said supermarkets would point to their own rising costs as the reason for price rises.
But it said margins had continued to grow - all of the major supermarkets had experienced an increase in price-cost margins, which meant that retail prices were increasing faster than the cost of the goods.
The report said supermarkets “continue to achieve higher levels of profitability than we would expect in a workably competitive market”.
It was not likely that Costco would be able to expand to the point where it could become a serious third supermarket contender, it said.
The report said the Warehouse could be an option - its network of shops meant it was in a good position to encourage shoppers to split their shopping in many cases - but it had said it had no intention of raising the capital needed to compete.
The “five things” don’t work that well as a list, but they are:
- High prices aren’t in your head
- Competition is not bringing down margins, or prices
- Other competitors aren’t finding it easy
- Innovation, but is it what we want?
- Would fines make a difference?
This might be a big city thing. In my town the cost of bulk rice for example is always cheaper at Pak n Save (which does 5kg bags) than in either Bin Inn or the Asian supermarkets. Same with meat versus butchers.
Veg is hit and miss everywhere but green veges are sometimes cheapest at some of the Asian places, though to be fair it’s not usually the same veges.
I’m in a smaller city, so could just be luck with the stores I have available. But also i’m thinking of the balance between price & quality too I guess. Definitely the bigger your urban area the more options will be available though. The Supermarket chains have over the years put local greengrocers and butcheries out of business in the smaller areas.
This is a big town thing.
Small town don’t have the range of shops. But we still have a few.