Supermarket Breakup Proposals Risk Higher Food Prices, Foodstuffs Chief Says
New Zealand’s looming general election has put the grocery sector on high alert, with political parties pursuing policies that could split up the dominant supermarket duopoly of Foodstuffs and Woolworths. Foodstuffs NZ Managing Director Chris Quin argued on the Q+A program that these breakup proposals carry a distinctly “populist” streak and threaten to raise, rather than lower, food prices at the checkout, 1news.co.nz reported.
Most political parties except ACT are heading into the upcoming election with plans designed to dismantle the scale of the country’s major supermarket operators. Quin stated that separating retail and wholesale supply operations runs a real risk of producing the exact opposite of lawmakers’ intentions. The uncertainty is already impacting major capital expenditure, including a $340 million warehouse expansion in Palmerston North announced two weeks earlier.
Store Owners Raise Alarms Over Policy Uncertainty
The ongoing political debate has rattled the independent owners who operate under the Foodstuffs cooperative model. Quin noted that the uncertainty is actively weighing on commercial investment decisions across the country’s store network.
“That’s why you’ve seen 530 families who own these stores be quite concerned and quite frightened and quite alarmed about what is proposed here,” Quin said on Q+A. Store owners are questioning whether to install new refrigeration units or invest in store upgrades while major structural reforms remain on the table.
Broader Retail Competition and Past Covenants
Pushing back against the duopoly label, Quin asserted that traditional market measures overlook a wide and growing range of alternative competitors. He estimated that about 80% of households shop outside Foodstuffs and Woolworths each week, frequenting retailers such as Chemist Warehouse, Kai Co, Tai Ping, and Pino Foods.
When questioned by host Simon Mercep about the company’s historical use of restrictive land covenants to block rivals, Quin acknowledged past practices. In 2024, the High Court in Wellington fined Foodstuffs North Island $3.25 million for lodging land covenants intended to block competing supermarkets. Quin stated that those actions predated his 11 years in the industry, noting that the cooperative recognized they were against the spirit of competition and stopped using them. The Commerce Commission previously noted that Foodstuffs North Island committed in 2021 to ending the practice and admitted the conduct at the earliest opportunity, while Justice Radich’s judgment observed the company had never enforced the covenants.