Foodstuffs North Island believes food prices here are not higher than abroad, and says its profits are not as high as international standards.
Chief executive Chris Quinn said the company had a Promises on land agreements, Which prevents competitors from forming in certain places, as part of the submission in response to a Commerce Commission Market Study, Which highlighted the anti-competitive attitude and extra profits in the grocery industry.
“We are committed to issuing restriction agreements on everything we sell, wherever we own.
“Basically we’re saying we’ve found that the availability of sites is part of a good, competitive market dynamic.”
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The submission argued that “New Zealand grocery prices are not high by international standards”, although it also argued that a direct comparison of international prices does not accurately reflect the level of competition in the market.
Quinn said the organization was also willing to support a “consumer-centric” code of conduct for the grocery industry, which has come under fire for its handling of suppliers.
However, it will not be drawn which international code of conduct will be in favor of the model.
Catherine Rich, chief executive of the Food and Grocery Council. Foodstuffs North Island has previously been accused of trying to “break people” with “extreme demands” from suppliers.
Earlier, the council argued that supplier squeezing halted innovation, reduced the number of competitors in the market, and did not reduce prices for consumers, only for better profit margins for supermarkets.
Quinn acknowledged that Foodstuffs North Island has been a major target of critics on the issue, presenting a two-and-a-half-year customer drive transformation project that meant purchasing decisions were central, and one of the brands. The narrow range continued. On the shelves.
“There have been a lot of interpretations and, you know, stories about issues that are claimed to exist in terms of the relationship between us and suppliers,” Quinn said.
“I’ve occasionally raised the issue that we’ve dealt with it … I would say overall, I see a very positive, pretty productive relationship, and we feel relatively comfortable about it. Are
“But the purpose of the code is to say, ‘Look, let’s get this all out in the open.’ It will also ensure that customers benefit from a good, competitive business. “
The full submission is not yet available, but it has issued an executive summary in advance of a full copy appearing on the Commerce Commission’s website.
Movement on land contracts is the biggest change that food has signaled in their submission. He said 50 properties are protected by contracts, which prevent people from building or operating supermarkets on these sites. There were also 18 lease agreements to protect 18 food staff supermarkets from competition.
The submission does not focus on wholesale and retail issues, including the possible distribution of these operations.
Quinn argued that distributing wholesale and retail would not do much for the competition, as any future competitor would establish its own wholesale operations and supply chain.
Foodstuffs North Island also argued that the Commerce Commission had underestimated its asset base and increased its profits.
The Commerce Commission estimates its return on investment is close to 24 percent, but the cooperative has kept that figure at 9 percent. It is only 11% below the international average, he said.
“We understand that the assets that have been used to secure our return include all of our supply chain technology and all of our retail store network, which is sufficient,” Quinn said.