Office Closed 29 September 2022 for a Team Strategy Day

Is it time for an iwi owned supermarket?


With the cost of living in Aotearoa skyrocketing and inflation now at its highest in 30 years, for some, even the basics are out of reach. Walk into any supermarket across the country and the price of some items can be eye-watering. It seems ridiculous to me, that in our bountiful country, people can’t afford to buy good food. In some areas the price of fruit and vegetables have risen 18% in the past year, making ‘5 plus a day’ difficult to achieve.

The lack of competition at the supermarket checkout is an issue. For many years now, the two big companies, Foodstuffs (New World, Pak n Save) and Woolworths NZ (Countdown) have dominated the industry and made it practically impossible for a third-player to enter the market.  

The detrimental impact of this duopoly and higher prices on grocery buyers, including iwi communities, is obvious. The duoploy also impacts grocery suppliers, as the market power of Foodstuffs and Woolworths means they have a huge say in what suppliers are paid – and suppliers don’t have a lot of options if they don’t like those prices.  This impacts, for example, Māori-owned suppliers in the fisheries, agriculture and horticulture industries.

While the recent Commerce Commission probe into supermarkets recognised there was only “muted” competition in this sector, it has been criticised for doing little to fix the issue. It stopped short of breaking up the duopoly and forcing them to sell off some of their stores, opting instead for more limited recommendations, such as seeking to make more land available for new grocery stores by changing planning laws to free up sites.

The Commission also called for the big players to improve access to wholesale supplies and prices for smaller players, and recommended the creation of a grocery sector regulator and dispute resolution scheme to resolve wholesale and supplier disputes.

The Government took a hard-line many years ago to break up Telecom (into Chorus and Spark) to increase competition in telecommunications, which has worked.  The softly-softly recommendations the Commerce Commssion put forward are not expected to be enough, and the Government has indicated it may take more drastic steps than those recommended. Here’s hoping that when the Government announces its response next month, it will be bold, and go further, to really make a difference.

An exciting opportunity for a third-player could be created in this industry, and that new player could be iwi-owned. Iwi are already major players across in food industries with significant resources. All of which could help support a new supermarket chain with positive flow on effects for not only Māori, but all of Aotearoa. 

Ngāti Whātua Ōrākei Whai Rawa would absolutely consider an investment opportunity if the right one came along in this sector - perhaps in partnership with other iwi. Our objective is always to protect and grow the assets of the hapū for generations to come, so we’re not a speculative investor, and for us to step into the ring we would need the right partner and the right landscape. There needs to be a “level playing field” for all players in the sector, and I believe this will only be possible if the Government takes real, lasting action.