New Zealand grocers losing out heavily to supermarkets

By RJ Whitehead

- Last updated on GMT

Related tags: Roy morgan research, Grocery store, Supermarket

New Zealand grocers losing out heavily to supermarkets
In the year to June 2013, almost three quarters of the country’s NZ$93m weekly average fresh produce expenditure went on supermarket fruit and vegetables, meat, bread, deli foods and fish.

And, according to Roy Morgan Research, Kiwis spent NZ$4.9bn on fresh produce last financial year - over NZ$3.6bn of which went to supermarkets.

Kiwis are clearly doing a one-stop grocery shop by purchasing their fresh produce at the supermarket, rather than traditional fruit and veg shops, butchers, bakeries, delis and fishmongers​,” said Pip Elliott, general manager, Roy Morgan Research NZ.

Price wars

It’s no wonder the major supermarkets are engaged in a price war for a larger share of the nearly $5 billion fresh food market.

Countdown, which is New Zealand’s leader in terms of overall market-share, had engaged in two public battles recently over price comparisons in advertising with both supermarket rival Pak ‘n Save and meat chain Mad Butcher. 

In the year to June, Countdown trailed Pak‘n Save in the fresh meat category, taking NZ$450,000 less per week; however both supermarkets took over three times the Mad Butcher chain’s NZ$2.6m in average weekly customer sales.

Supermarkets dominating

Almost 80% - or NZ$74m - of Kiwis’ total fresh produce budget goes on fruit, vegetables and meat, with supermarkets dominating both categories, accounting for 70% of the fruit and vegetables budget and 77% of meat.

However supermarkets take an even greater slice of bread (83%) and deli (93%) expenditure, totalling almost NZ$13m of the NZ$15m spent weekly. However a sizeable 40% of the NZ$5m weekly fish budget goes outside supermarkets.   

Just 15% of fruit and veg expenditure was at greengrocers and 17% of meat expenditure at butcher shops, compared with 27% of fresh fish at seafood retailers.

And only around NZ$57,000 of New Zealand’s NZ$6m weekly allowance on deli foods was spent at delicatessens.

Related topics: Markets, Oceania, Industry growth

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