Grocery Market Regulation Dashboard 

Foodstuffs North Island supports the purpose of the Grocery Industry Competition Act 2023, to promote competition and efficiency in the grocery industry in New Zealand, for the long-term benefit of consumers. Under the Act, we’re one of three regulated grocery retailers in New Zealand who must take steps to help achieve that purpose. There are some actions we have immediately gotten on with ourselves, and others that require a joint effort with our supplier partners. Below is how we’re going as at 01 February 2024.

Retail

We know how important it is for our customers to have the right information at the right time, so they can make properly informed purchasing decisions. That’s why we’ve made changes to the way we price products, and taken steps to ensure the price on the ticket is what’s paid at the checkout. We’re also keeping a close eye on food inflation and being transparent by telling customers what’s driving it and how to save, while continuing to invest heavily in our product range and stores.

Price transparency

We’ve simplified our prices and promotions so they’re easier for our customers to understand. 

  • Simplifying our specials

    We’ve made our shelf prices easier to understand by simplifying our pricing tickets and offering more goods at everyday low pricing (EDLP).

    PAK'nSAVE (3 price tickets only)
    Effective from July 2022    		 New World (4 price tickets only)
    Effective from January 2023    		 Four Square stores have had three tickets since 2022 

    Regular

    Regular

    		  Regular

    For undiscounted goods that stay low for longer

    Everyday Low

    For undiscounted low prices that last

    Everyday Low Price

     For undiscounted great prices that last

    For limited time specials

    Extra Low

    For limited time specials for all customers

    Super Saver

     For limited time specials
     

    For specials for New World Clubcard members

    Club Deal

    		  

    More info tickets can be found on the websites for PAK'nSAVE, New World and Four Square.

     

  • Introducing unit pricing

    We’ve undertaken significant work to introduce unit pricing, which lets shoppers see how much an item costs by weight, volume or number, so they can make accurate price comparisons.

    On 31 August 2023, the Consumer Information Standards (Unit Pricing for Grocery Products) Regulations 2023 came into effect. All qualifying physical grocery stores must comply by 31 August 2024 and online grocery stores by 31 August 2025.

    As at 01 February 2024:

    • Products in all our stores in the North Island have unit pricing where we can.

    • Our stores have unit pricing on their websites and all online products have unit pricing where we can.
    • Technical solutions are being worked through to apply unit pricing to complex promotions in store and online, and electronic shelf labels in some locations

      We’re now working through the detail of the Regulations and working to implement this instore and online within the transition period.

 

Price integrity

We’re focused on continuing to ensure what customers see on the shelf is what they pay at the checkout.
  • Electronic shelf labels
    Instore shelf prices have historically been printed on paper or stickers and changed manually by team members. Electronic shelf labels (ESLs) are small, battery-powered electronic displays that present product and pricing information at the shelf edge. ESLs use wireless technology to communicate with each stores central pricing hub to form a more dynamic way of ensuring up-to-date information is communicated to customers.

    As at 1 January 2024, 144 (84%) of our stores across the North Island now have ESL systems in place. Most of our larger stores have them, including 90 New Worlds (87%) and 38 PAK’nSAVEs (84%).
  • Price integrity monitoring
    Our stores are committed to ensuring all advertised prices and shelf prices are honoured at the checkout. All New World and PAK’nSAVE stores have an appointed dedicated Price Integrity Officer, responsible for checking shelf prices are accurate.
     
    If a customer believes they haven’t been charged the correct price, we encourage them to let us know so we can refund them directly. Information on how to do this is in our Refund & Returns Policy here.

 

Innovation

As a customer-driven business we’re constantly investing in ways to improve our customers’ shopping experience and ensure our supply chain stays efficient and resilient.
  • Investment in our stores

    Every year we spend around $100 million on building new stores and renovating existing ones in local communities right across the North Island.

    Investments delivered in 2023 include:

    • - Nine new stores opened: New World Taumarunui, Four Square Eden Terrace, Four Square Te Kowhai, PAK’nSAVE Warkworth, Four Square Onehunga, Four Square Waverley, Four Square Mount Maunganui, Four Square Britomart and Four Square Fitzroy.

    • - 27 improvements to existing stores including a checkout upgrade for PAK’nSAVE Mill Street, seismic strengthening and a roof replacement for PAK’nSAVE Rotorua, a CO2 refrigeration replacement for PAK’nSAVE Sylvia Park, back of house safety review and design for Four Square stores and a carpark extension for Gilmours Wellington.

      In 2024, we’re planning on opening at least six new stores including Four Square Opunake, PAK’nSAVE Highland Park, New World The Sands Papamoa, PAK’nSAVE Te Rapa, New World Havelock North and New World Point Chevalier as well as refurbishing another 50 stores.
  • Supply chain improvements
    Maintaining a network that can supply 300+ stores and serve 4.08 million customers every week requires ongoing investment, including major projects.

    In March 2023, we opened our new cross dock and depot facility in Hastings, investing $20 million on the 3,000 sqm facility. That’s helping us transform the way we distribute groceries across the entire North Island.

    In November 2023, we opened our new Grenada transport and milk depot in greater Wellington, investing $21 million on the 3,250 sqm facility that enables us to handle more freight than ever before, while providing capacity to support growth in the Wellington region and service future stores.
  • Online solutions

    We’ve invested in novel e-commerce fulfilment formats, including:

    • - ‘Drive-thru’ Click & Collect opening at PAK'nSAVE Albany, PAK’nSAVE Rotorua and PAK’nSAVE Warkworth.
    •  
    • - A trial partnership between Uber Eats and 21 stores, offering ultra-rapid grocery delivery.
  • More options on shelves
    We stock more than 50,000 different products across our 300+ stores. These are sourced from suppliers of all shapes and sizes, including some of New Zealand’s most famous brands, the world’s largest global manufacturers and start-up Kiwi entrepreneurs who are looking to take on the world. We’re constantly looking for new products that offer consumers better value, higher quality and more choice, introducing 9,000 new products on-shelf each year.

 

Accountability

We’re working hard to mitigate the role we play in price movements at a time of high inflation.
  • Monitoring food price inflation

    Since May 2022, we’ve been comparing how Stats NZ’s monthly food price inflation figure compares with price movements for the same goods categories at our North Island and South Island co-ops, while also being transparent by informing consumers about the various factors behind any price changes that month.

    • - As at 01 January 2024, we’d managed to keep our monthly food price increases below or equivalent to Stats NZ’s figure for 19 months in a row.
  • Our Grocery Supplier Cost Index
    Since August 2022, Foodstuffs has commissioned independent economics firm Infometrics to produce the monthly Infometrics-Foodstuffs NZ Grocery Supplier Cost Index (GSCI), measuring the change in the list cost of over 60,000 goods, charged by suppliers to our North Island and South Island co-ops.

Competition

We’ve been busy removing any genuine barriers to market entry that are within our control, including freeing up land for retail development by others and offering a wholesale service to qualifying non-member wholesalers and retailers.  

Freeing up land for development

We know new supermarkets need a lot of land to build on and have moved away from practices that may have hindered competition.
  • Removing land covenants

    In August 2021, we committed to ending the use of restrictive land covenants and exclusivity provisions in leases, and immediately started a process to identify and remove any such clauses in existing tenancy contracts. While that process is underway, no covenant or exclusivity provision has, or will be, enforced.

    We no longer include restrictive covenants or lease exclusivity provisions in new property transactions, and support the Commerce (Grocery Sector Covenants) Amendment Act 2022, which deems covenants unenforceable and will accelerate the process of their removal.

    As at 23 January 2024:

    - We’ve removed 39 of the 56 restrictive covenants that were registered against blocks of land, and made removing the remaining 17 an ongoing priority.

    - We’ve removed restrictive covenants from 123 of the 196 affected titles specific to that land. Over time, the total number of affected titles may change as a result of subdivisions or amalgamations by third parties.

    - 100% of the remaining covenants are registered against land we do not own. To remove them we’re using the unilateral process provided by section 28B of the Commerce Act, where possible. Otherwise, we are working with landowners to arrange for their removal.  

  • No land banking
    Our co-operative does not buy land with the primary aim of leaving it undeveloped for a capital gain. Any land we invest in is solely for the purpose of developing it into a Foodstuffs store, at the right time for that specific community, depending on factors like population and infrastructure.

 

Offering wholesale supply

We’re supportive of calls to enable greater competition in the grocery industry via the establishment of a competitive wholesale grocery market, and are committed to being an active participant. 
  • Wholesale supply

    In March 2023, we opened our wholesale supply offering to qualifying wholesale customers, allowing retailers who are not members of our co-operatives to apply to purchase goods from our distribution centres, for on-sale to consumers.

     

    This infographic shows how the Foodstuffs co-ops currently operate, and how our wholesale supply offering sits within that framework.

     

    As at 21 February 2024:

    - 29 wholesale customers have been approved to purchase from our wholesale service.

     

    - Nearly $680,000 worth of goods have been sold via our wholesale service.

     

    - 227 suppliers have agreed to let their goods to be offered for sale via our wholesale service.

     

    Qualifying providers can apply to access our wholesale service here. 

Suppliers

We greatly value our relationships with the many growers, manufacturers and importers who provide the roughly 50,000 goods that stock our shelves. We work closely with our supply partners to ensure consumers benefit from competitive prices, quality and choice.

Upholding the Grocery Supply Code

We’re committed to abiding by the Grocery Supply Code of Conduct, which gives clarity to the rules of engagement with our suppliers, to drive better outcomes for customers.
  • Information

    The full text of the Grocery Industry Competition (Grocery Supply Code) Amendment Regulations 2023 (at 28 August 2023) can be viewed here.

    A Commerce Commission factsheet summarising the Code (at 28 September 2023) can be read here. 
  • Implementation

    Since the Code took effect on 28 September 2023:

    All members of our Merchandising team have received training in upholding the Code, as well as a large number of our store teams.

Regular engagement with suppliers

We’ve continued our efforts to ensure we’re listening to our supplier partners, identifying any issues that need to be addressed, and ultimately helping them to succeed. 
  • Monthly supplier forums
    Every month our senior leaders host an online forum where suppliers can hear updates and ask questions. On average, around 350 suppliers join these monthly forums. 
  • Monthly supplier e-newsletters 
    We also send our suppliers a fortnightly email with relevant updates about what’s happening at our co-op, customer insights, our category review calendar and other information suppliers need to know.   
  • Supplier working group 
    For many years we’ve had a supplier working group that meets monthly and is tasked with improving how we work with our suppliers. As a result, we’ve received feedback on our grocery supply contracts, topics of interest to include in our supplier updates, feedback on supplier sentiment and input into our emerging supplier programme.  
  • Biannual Foodies Connect conference 
    Twice a year our senior leaders host the Foodies Connect conference at our Support Centre in Mangere, Auckland, usually around March and September. The most recent Foodies Connect was attended by around 500 supply partners.  
  • Biennial Supplier Expo  
    Every two years, we host a two-day expo where suppliers can connect with representatives from locally owned and operated New World, PAK’nSAVE and Four Square stores from across New Zealand – who can taste, test and learn about new products from local and international suppliers. The biggest food industry event of its kind in New Zealand, our March 2023 Supplier Expo was attended by 350 supplier brands.  
  • Small supplier guide
    We’ve created a comprehensive guide for smaller suppliers that provides tips and tricks to help make it easier to get products on the shelf in our retail stores.  
  • Emerging supplier support 
    In May 2023, we held our first online Emerging Supplier Forum, which is designed to help our smallest suppliers succeed. As at 1 January 2024, we’d held 16 further forums for emerging suppliers. 
  • Supplier surveys

    In February 2023, we appointed an independent, third partner organisation called Advantage Group to run our first supplier survey. We’re now taking relevant learnings from the survey and applying them to our co-op, as appropriate.

    Existing and prospective suppliers can find out more about being a Foodstuffs supplier on our 'Partnering with us' webpages, including the Supplier Community webpage here.