Consumer Watchdog: Kiwis' bill tops Ulli's poll

By Andre Hueber

German TV Journalist Ulli Weissbach compared prices in four countries. Photo / Janna Dixon
German TV Journalist Ulli Weissbach compared prices in four countries. Photo / Janna Dixon

Basic items dearer than in Australia, UK and Germany, spot survey shows.

Shoppers feeling the sting at the supermarket checkout have the sympathy of a German-born Kiwi who was stunned at how cheap food prices were when he returned to his homeland for a visit.

Ulli Weissbach, a TV producer and Kiwi citizen, was in Germany for a holiday in June and, after being astounded by the food prices, decided to dig a bit deeper.

He surveyed the prices of a range of grocery items across four countries and New Zealand emerged as the most expensive - ahead of Australia, the UK and Germany. He selected six everyday items which could be purchased in New Zealand and did not include seasonal food like tomatoes to avoid an unfair comparison between winter and summer in the two hemispheres.

The total price ranged from $33.12 in Germany, to more than $44 here.

"That doesn't make sense to me," he said. "We're an agricultural country and most items are produced here. Why should they be more expensive than anywhere else?"

In Germany wages were almost twice as high as in New Zealand which "hurts Kiwis even more".

Weissbach said he thought that there was a lack of competition in New Zealand where the market was dominated by two supermarket chains.

But a spokesman for one of those chains, Progressive Enterprises, said the figures were misleading and that some factors, such as GST, were beyond their control.

National communications and public affairs manager Luke Schepen said GST of 15 per cent was applied to Kiwi goods, but there was no tax on some of the items listed from the other countries. In some countries farmers were subsidised to produce free-range eggs which would bring down the price and shelf prices here reflected what Progressive paid for the product from their suppliers.

"At the end of the day after we pay interest and tax our net operating profit is under 2 per cent. In other words, for every dollar that our customers spend in our stores, we make less than two cents."

Schepen said there was no doubt New Zealand was seeing pressure on food prices as the country operated in a global market.

A year ago a can of baked beans in Europe would have been up to 10 cents dearer because of the higher exchange rate, another factor that distorted Weissbach's figures.

"The Kiwi consumer is extremely savvy and they vote with their wallets every day on where they want to shop and who offers the best value."

He was backed by a retail analyst at market research firm Coriolis, Tim Morris, who didn't accept the statistical validity of the comparison. "It's like picking six people in downtown Auckland, finding three are gay and saying there's more gay people in Auckland than in San Francisco."

He said Kiwi supermarkets were not excessively profitable compared to the top 20 chains around the world.

A Commerce Commission spokesperson would not comment on the level of competition between supermarkets but said if people complained about specific anti-competitive mergers, agreements and conduct in the sector, the commission would consider the complaint.

- Herald on Sunday

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