New importer margins monitoring reflects discounting practic

New importer margins monitoring reflects discounting practices

9 September

The Ministry of Business, Innovation & Employment has revised its weekly monitoring of importer margins on petrol and diesel prices to reflect discounting activity, says the Ministry’s energy and building trends manager Bryan Field.

“The first revised weekly monitoring report has been published today. We have also applied the new method to previous weekly data dating back to 2006, around the time discounting practices begun to emerge.

“Discounting activity has become increasingly significant in recent years. The new reporting enables us to capture this and responds to industry calls for the need for it to be taken into account when monitoring importer margins,” says Mr Field.

“The new method factors in shopper coupons and regional discounting that reduce the actual price motorists pay at the pumps. Loyalty schemes that discount petrol prices, such as AA Smartfuel, are included — but not broader schemes such as Fly Buys.

“The new monitoring shows the discount in the December quarter 2006 was around one cent per litre. In the June quarter 2015 it was around eight cents per litre,” Mr Field says.

The importer margins MBIE is now monitoring reflect the difference between the discounted price less duties, taxes, levies, the New Zealand Emissions Trading Scheme (ETS) and the importer cost. That is, the gross margin available to the retailers to cover domestic transportation, distribution and retailing costs, and profit margins.

See here for further information and to access the monitoring reports.

ENDS

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