There is a popular belief out there that the Foodstuffs/Countdown
duopoly will have to be broken up to make the grocery business in NZ
more competitive. This will require that not only can a new player
set up shop, but some existing outlets will be permitted or required
to move to the new player.
This is fraught with unintended consequences. Foodstuffs in
particular does not own any supermarkets so has none it can sell.
Foodstuffs is in fact two companies - Foodstuffs North Island based in Auckland and Foodstuffs South Island based in Christchurch. There is
also Foodstuffs NZ, but that is owned equally by the NI and SI
companies so I would expect that it deals with branding and other
common requirements.
The NI and SI companies are co-operatives - owned by the individual
store owners. Each store owner can own one store, though they can own
two for a short period of time when an existing owner buys another
store before the sale of their old store is completed.
So if Foodstuffs is required to divest stores, how can this be done
when both Foodstuffs companies don't own any? Does this mean that
some Foodstuffs store owners will be forced to leave the co-operative
and join the new player?
Then we get to Countdown, owned by Progressive Enterprises that is
itself owned by Woolworths Australia. This is not a co-operative but
some Countdown stores are franchised - it is not possible to know the
counts of franchised vs company-owned stores.. Presumably Countdown
could divest company-owned stores.
So breaking up the duopoly is not as simple as it would seem unless
the property rights of Foodstuffs store owners in particular are
restricted to non-Foodstuffs options.
On 2023-04-21, Crash <nogood@dontbother.invalid> wrote:
There is a popular belief out there that the Foodstuffs/CountdownFoodstuffs, the task is to smash the coperation between the stores. Each >group has to go it alone.
duopoly will have to be broken up to make the grocery business in NZ
more competitive. This will require that not only can a new player
set up shop, but some existing outlets will be permitted or required
to move to the new player.
This is fraught with unintended consequences. Foodstuffs in
particular does not own any supermarkets so has none it can sell.
Foodstuffs is in fact two companies - Foodstuffs North Island based in
Auckland and Foodstuffs South Island based in Christchurch. There is
also Foodstuffs NZ, but that is owned equally by the NI and SI
companies so I would expect that it deals with branding and other
common requirements.
The NI and SI companies are co-operatives - owned by the individual
store owners. Each store owner can own one store, though they can own
two for a short period of time when an existing owner buys another
store before the sale of their old store is completed.
So if Foodstuffs is required to divest stores, how can this be done
when both Foodstuffs companies don't own any? Does this mean that
some Foodstuffs store owners will be forced to leave the co-operative
and join the new player?
Then we get to Countdown, owned by Progressive Enterprises that is
itself owned by Woolworths Australia. This is not a co-operative but
some Countdown stores are franchised - it is not possible to know the
counts of franchised vs company-owned stores.. Presumably Countdown
could divest company-owned stores.
So breaking up the duopoly is not as simple as it would seem unless
the property rights of Foodstuffs store owners in particular are
restricted to non-Foodstuffs options.
For Countdown, a similar tactic is required. Each supermarket is to be >independent.
Capitalism does not scale well. The task is to keep breaking the links of >co-operation and no store larger than xm2 or $x dollars turn over.
This would result in many stores fighting for customers.
On 21 Apr 2023 04:23:14 GMT, Gordon <Gor...@leaf.net.nz> wrote:
On 2023-04-21, Crash <nog...@dontbother.invalid> wrote:
There is a popular belief out there that the Foodstuffs/CountdownFoodstuffs, the task is to smash the coperation between the stores. Each >group has to go it alone.
duopoly will have to be broken up to make the grocery business in NZ
more competitive. This will require that not only can a new player
set up shop, but some existing outlets will be permitted or required
to move to the new player.
This is fraught with unintended consequences. Foodstuffs in
particular does not own any supermarkets so has none it can sell.
Foodstuffs is in fact two companies - Foodstuffs North Island based in
Auckland and Foodstuffs South Island based in Christchurch. There is
also Foodstuffs NZ, but that is owned equally by the NI and SI
companies so I would expect that it deals with branding and other
common requirements.
The NI and SI companies are co-operatives - owned by the individual
store owners. Each store owner can own one store, though they can own
two for a short period of time when an existing owner buys another
store before the sale of their old store is completed.
So if Foodstuffs is required to divest stores, how can this be done
when both Foodstuffs companies don't own any? Does this mean that
some Foodstuffs store owners will be forced to leave the co-operative
and join the new player?
Then we get to Countdown, owned by Progressive Enterprises that is
itself owned by Woolworths Australia. This is not a co-operative but
some Countdown stores are franchised - it is not possible to know the
counts of franchised vs company-owned stores.. Presumably Countdown
could divest company-owned stores.
So breaking up the duopoly is not as simple as it would seem unless
the property rights of Foodstuffs store owners in particular are
restricted to non-Foodstuffs options.
Do you men every store? Or every group (eg New World, PaknSav etc)?
For Countdown, a similar tactic is required. Each supermarket is to be >independent.
Fine if their are company-owned but if they are franchised the
government makes that illegal.
Capitalism does not scale well. The task is to keep breaking the links of >co-operation and no store larger than xm2 or $x dollars turn over.
This would result in many stores fighting for customers.The whole point is that they fight over customers only for the 'other'
brand - not competing with same-brand stores.
--In Upper Hutt itself we have two countdowns within a couple of hundred metres of each other and a Pack n' Save. The nearest New World is at Silverstream. It's funny but I get junk mail from New World in Trentham even though even if I had a car I'd still
Crash McBash
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