Questionable supermarket policy needs investigation: Greens
Allegations that supermarket giant Progressive Enterprises is applying pressure to its suppliers adds further impetus to
the Green Party's call for a Commerce Commission inquiry into industry practices, and a code of conduct for
supermarkets, Safe Food Spokesperson Sue Kedgley says.
According to a news report, grocery suppliers will be penalised for having their products promoted in rival supermarkets
at or around the same time as Progressive's own advertised promotions. If this occurs, suppliers would be charged for
the differential on the price offered in the opposition supermarket.
"These are precisely the kind of tactics that penalise small independent growers and suppliers who are already
struggling in a highly competitive environment," Ms Kedgley says.
"Progressive allegedly wants details of suppliers' supermarket specials with trade competitors - in advance - and will
not accept promotions for inclusion in its mailers where there is a clash with a competitor's promotion arranged by the
supplier," Ms Kedgley says.
Ms Kedgley says she is alarmed at reports that, while suppliers are furious about these practices, they fear if they
don't play ball, their products would be left off supermarket shelves.
"Why should a farmer who grows and supplies broccoli to Progressive and the local New World be punished by a
retrospective cut on their payment from Progressive because New World decides to have a special on broccoli in the same
week?
"Most farmers and manufacturers have nowhere else to sell their produce than the two supermarket chains that control 96
percent of New Zealand's grocery market. An investigation would clarify whether there is any truth to the allegations
that Progressive may be misusing its position to force small farmers and business people to take cuts in their margins.
"It would also determine whether this practice breaches the restrictive trade practices under the Commerce Act.
"New Zealanders spent $16 billion in supermarkets last year. They are a huge business, and it is essential that there
are clear rules governing the trade, which prevent unfair trading practices occurring in the sector. That's why we need
a Commerce Commission Inquiry into the sector and a code of conduct for supermarkets, such as exists in the United
Kingdom," Ms Kedgley says
ends