Latest news with #PierreVanHeerden
RNZ News
01-07-2025
- Business
- RNZ News
Foodstuff's North Island gets warning from Commerce Commission
Shopping trollies at a supermarket. Photo: Unsplash/ Markus Spiske The Commerce Commission has sent a warning to Foodstuffs North Island for 'uncooperative and unreasonable' behaviour towards a supplier. Grocery Commissioner Pierre van Heerden says Foodstuffs North Island likely breached a fundamental aspect of the Grocery Supply Code, that states retailers must deal with suppliers in good faith at all times. The Code is under consultation at the moment and as part of that the regulator wants to strengthen the position of suppliers with supermarkets.
RNZ News
01-07-2025
- Business
- RNZ News
Foodstuff's North Island
The Commerce Commission has sent a warning to Foodstuffs North Island for 'uncooperative and unreasonable' behaviour towards a supplier. Grocery Commissioner Pierre van Heerden says Foodstuffs North Island likely breached a fundamental aspect of the Grocery Supply Code, that states retailers must deal with suppliers in good faith at all times. The Code is under consultation at the moment and as part of that the regulator wants to strengthen the position of suppliers with supermarkets. To embed this content on your own webpage, cut and paste the following: See terms of use.
RNZ News
01-07-2025
- Business
- RNZ News
Foodstuffs North Island warned over likely breach of grocery competition law
Foodstuffs owns Pak'n Save and New World. Photo: RNZ The Commerce Commission has given Foodstuffs North Island a warning over a likely breach of grocery competition law and asking suppliers to bring forward any complaints about unfair treatment. The Grocery Commissioner Pierre van Heerden said the Grocery Industry Competition Act required retailers to deal with suppliers in good faith at all times. "I'm concerned that this follows a pattern of behaviour that has been present in the industry for decades," he said. "This behaviour has been enabled for so long due to the significant power imbalance between the major supermarkets, who hold the vast majority of the market, and suppliers, who have limited bargaining power in comparison." While the Commerce Commission issued only a warning, van Heerden said further action would be taken if more examples came to light. "Foodstuffs North Island appears to have obstructed and delayed a supplier request by acting in ways that we believe were uncooperative and unreasonable," van Heerden said. "In this instance, based on the evidence we have, we decided a warning was the right response." He said Foodstuffs North Island category manager that acted as the main point of contact for the supplier, was also investigated regarding their role in the matter and given a warning. "Suppliers are reliant on their relationships with the retailers' commercial teams, so the staff in these roles within the supermarkets hold a lot of power. Any behaviour that weaponises this power imbalance is unacceptable," he said. "The major supermarkets have a responsibility to make sure their staff are properly trained. They need to make sure their staff follow the rules and deal with suppliers in good faith." He said further changes were proposed to the Supply Code which would provide more scrutiny and clarity about what was acceptable behaviour. "Our supplier survey showed that 37 percent of suppliers reported their interactions with Foodstuffs North Island as negative or very negative. "This is significantly higher than suppliers' ratings for Woolworths and Foodstuffs South Island, at approximately 20 percent." Van Heerden said the supply code was designed to protect small and medium sized suppliers. "We really appreciate where suppliers have come forward to tell us about issues so we can take action - like in this case where we heard directly from the supplier involved," he said. The warning letter can be found on the Commission's website.
Yahoo
05-06-2025
- Business
- Yahoo
NZ watchdog mulls tightening grocery rules to create fairer playing field
New Zealand's competition regulator is proposing measures to create a fairer playing field between emerging grocery producers and the major supermarkets. In a two-pronged initiative, the Commerce Commission is also concerned that smaller grocery retailers face a disadvantage over their more dominant counterparts when it comes to securing competitive prices from large suppliers. The Commission presented its findings today (5 June) following a review of the Grocery Supply Code and is reaching out for feedback before it publishes its final report in September. "If the Commission doesn't see meaningful progress in 12 months, it will decide if regulations should be changed," the regulator said in a statement. Grocery Commissioner Pierre van Heerden explained: "We know the current grocery market is not serving Kiwi consumers well. The status quo lets a few major players set the rules for the rest of the industry which is negatively impacting consumers, new and expanding competitors, and small suppliers." He added: "These major players are the three main supermarkets and large national and multi-national suppliers. Their significant market share allows them to influence the settings of the market. This limits the ability for competing retailers to enter and grow in the market and often results in smaller suppliers getting an unfair deal." The draft recommendations to the Supply Code include curbing the circumstances in which supermarkets can bill suppliers for routine retail tasks, such as shelf stocking and display arrangement. Van Heerden highlighted the issue of a power disparity, saying that a "power imbalance between the major supermarkets and small suppliers creates a reluctance among suppliers to push back on supermarket demands or behaviour for fear of damaging relationships or losing access to supermarket shelves". New Zealand's grocery market is dominated by Foodstuffs and Woolworths. "The major supermarkets are the largest customers for most grocery suppliers," van Heerden said, controlling 82% of the market. The proposed modifications by the Commission would mandate supermarkets to keep records on how they are complying with the Code when undertaking "certain activities", including "negotiating promotions with suppliers and making deductions to payments without written consent". Looking into the wholesale supply of groceries, the Commission pointed out that promotional payments and rebates are generally inaccessible to newer or smaller retailers. 'A significant issue new and expanding supermarket competitors face is securing access to cost-effective groceries from large suppliers," Van Heerden said. "Competing retailers can't negotiate similar levels of support due to their weaker buying power." He also noted that the prevalent high-low pricing strategy used by New Zealand's major supermarkets is more extreme than in other countries, and a reduction in promotional dependence would result in more consistent and lower prices for consumers. 'The best option is for large suppliers and the major supermarkets to voluntarily change their behaviour. If they don't, we'll have to consider our other alternatives,' van Heerden said. "NZ watchdog mulls tightening grocery rules to create fairer playing field" was originally created and published by Just Food, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
RNZ News
05-06-2025
- Business
- RNZ News
Supermarket sector competition reports like Groundhog Day
Supermarket sector competition reports are like Groundhog Day. Photo: 123RF Analysis - Compare the following two statements: "Some of the signs I am seeing is that suppliers are very fearful of repercussion, there's a lack of trust." And... "My concern is that the power imbalance between the major supermarkets and small suppliers creates a reluctance among suppliers to push back." They are both from Grocery Commissioner Pierre van Heerden - the first from August 2024 , the second June 2025 . The nine months between the statements have produced another round of research, recommendations, and call for submissions with the aim of getting better deals for suppliers and consumers, forcing better behaviour and greater competition between the dominant Foodstuffs and Woolworths chains. The Commerce Commission's original market study was ordered in 2020, the final report published in March 2022, and law changes came into effect in 2023. The regulator looked to assist the transition through educating suppliers, offering them sample contracts to put to the supermarket chains, setting up a whistle blowing facility for those wanting to report bad behaviour, and a stern message to Foodstuffs and Woolworths to behave and play nice or risk the Grocery Commissioner's wrath. And yet the latest report concludes much as the first report - the grocery sector is not competitive and the duopoly keeps throwing its weight around, while the small suppliers remain intimidated. Grocery Commissioner Pierre van Heerden. Photo: The Grocery Commissioner has sought to engage with the two big chains and change attitudes. They have conceded most of the easy ground such as ending land banking, accepting the mandatory code of conduct, and agreeing to look at freeing up their wholesale arrangements. But clearly the original reforms have failed to cut through, hence the move to now strengthen the Grocery Supply Code to stop retailers charging suppliers for stocking shelves or for past-their-best by date groceries in the retailer's control; require retailers to reimburse suppliers if they buy stock at promotional prices, but later sell them at higher prices; and prohibit retailers from retaliating against suppliers who assert their rights under the code. van Heerden told RNZ that he had the resolve and the resources to take legal action when justified , but that bringing about change in the sector takes time. To date, the regulator has gone for the relatively low hanging fruit of misleading prices and advertising . The challenge now is to bring about real change in supermarket actions. A prosecution or two may be needed. The wild card in the supermarket debate is what will the government do. Finance Minister Nicola Willis entered the debate verbal guns blazing in March saying the government was looking at all options to bring greater competition to the grocery sector. She said that could be done either by encouraging a major new player into the sector or possibly a 'nuclear option' of breaking up or restructuring the existing chains. The government has issued a formal request for information (RFI) to accelerate improved competition, and advise on potential regulatory and legislative changes, and whether structural changes would be needed. That was an option which the Commerce Commission shied away from as being too difficult, commercially and legally. Going after supermarket chains assessed as profiteering from consumers reads well in headlines, but will the talk be turned into a walk? Or will it be down to van Heerden to make progress slowly, one supermarket aisle at a time? Gyles Beckford is RNZ's business editor. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
