The new report proves consumers pay a premium for the lack of competition, says the Grocery Action Group. Photo: 123rf.com
Fair prices for groceries should not depend on a shopper's postcode, a consumer advocacy group says
The Commerce Commission's Grocery Report - released yesterday - highlighted the fact that areas like Auckland enjoyed more competition and cheaper prices.
The Grocery Action Group said the commission's report had no good news for consumers.
Chair Sue Chetwin said the lack of competition in smaller centres meant the markups were much higher, even though overheads such as rent were much lower.
"In rural areas and smaller towns where New Zealand's supermarket choices are narrow or non-existent, the report confirms what those living there already know - that consumers pay a premium for the lack of competition," she said.
"This kind of geographic price gap is unacceptable. Fair prices shouldn't depend on your postcode."
Chetwin said on top of the 4.6 percent increase in grocery prices for the year to May, there were other findings in the report that were thoroughly alarming.
"For instance it notes we are paying higher than the OECD average for groceries even though we earn well below the average OECD wage.
"Another disturbing fact is the prices that the supermarket chains pay their suppliers are subsidised by around $5b in rebates, discounts and promotional payments paid by suppliers," Chetwin said.
She said the report confirmed Kiwi consumers were paying way over the odds for their groceries.
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