Editorial: Consumers should fight back in the grocery aisles

It's been a nightmare week for supermarket giant Progressive Enterprises - bad enough to test the best spin doctors.

Its Countdown brand has been put through the shredder, first with Australian parent brand Woolworths facing criticism over dumping New Zealand-made products over the ditch as part of a Buy Australia campaign, and then with allegations in Parliament of strong-arm tactics here against Kiwi suppliers.

The first part of this saga should be of concern to all New Zealanders, and threatens to test the traditionally strong New Zealand-Australian relations.

Aussie supermarket heavyweights Woolworths and Coles - which make up 80 per cent of the Australian retail market - are competing to be the "most Australian" company and boycotting foreign goods, reportedly resulting in extreme measures such as dropping Kiwi products, even if an alternative cannot be sourced locally.

An example is Talleys, which exported 900 tonnes of frozen spinach a year across the Tasman until being blocked.

The move is making local exporters nervous and said to be affecting not just house brands but also some branded products.

Prime Minister John Key raised the issue with counterpart Tony Abbott but he refuses to intervene, despite Mr Key saying the shut-out appears to breach the spirit, if not terms, of the 1983 transtasman Closer Economic Relations agreement.

The agreement, a cornerstone of faith between our two countries, allows for major flows of merchandise trade, investment, labour, services and visitors between the two countries.

This boycott makes a mockery of this important agreement and the strong relationship between our nations. It should not be allowed to pass without a strong response.

The cost to Kiwi exporters could be substantial.

I was disappointed with the response of Buy New Zealand, which limply said it would not become more aggressive or outspoken in response.

This is a case of bullying and turning the other cheek won't do any good.

It is also about fairness, money and national pride.

It is difficult to see what the long-term objective is for Woolworths, which is risking brand damage.

New Zealand should fight back, both at government and lobby level - and, most importantly, in the grocery aisles.

The power ultimately lies with consumers. If the Aussies don't want to stock our products, why should we buy theirs?

Countdown was already under pressure this week over the Aussie affair with Tauranga man Nevan Lancaster launching a Boycott Countdown Facebook page when Labour MP Shane Jones dropped his bombshell.

He used parliamentary privilege to allege Progressive was demanding payments from New Zealand suppliers to make up for losses last year.

The Food and Grocery Council knows of "a number of incidents where our member companies have been asked for retrospective payments".

Progressive refutes the allegations strongly.

Mr Lancaster's Facebook page has gained momentum quickly and by yesterday afternoon had attracted nearly 8000 "likes".

He wants consumers to give their grocery dollar to locally owned producers and suppliers and has the backing of Tauranga celebrity chef and flavours columnist Peter Blakeway.

The big supermarkets provide huge range, competitive prices and convenience. They will always dominate. Supporting smaller, local businesses and markets is also a good thing for local people and the local economy. A balanced approach is needed for all concerned.

Reputations are seriously on the line here with Progressive and Mr Jones saying different things.

We need the truth. It is critical the Commerce Commission investigates to establish just that.