The merits and drawbacks of removing GST on ‘health foods’ are interesting enough, but even more is the mystery of the spring onions that cost $3.00 at my local supermarket and $0.50 at the farmers market two minutes walk from the supermarket. Most fruit and veges enjoy a similar price difference: gaming the tax system for 12.5-15% savings is chump change by comparison with addressing the costs of our supermarket duopoly’s rather transparant price-fixing.
April 26, 2010
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Pingback by TVHE » GST and food. Why I’m against exempting the tax — April 26, 2010 @ 4:19 pm
Its a free market in spring onions, vote with your invisible hand.
Comment by andy (the other one) — April 26, 2010 @ 4:52 pm
which leads me to wonder, would removing GST actually make any difference to the supermarket prices at all? or would the supermarkets keep charging the same prices and make more profit?
Comment by kahikatea — April 26, 2010 @ 4:53 pm
The stupidmarket model is super efficient for non perishables but highly inefficient for spring onions. The spring onions get shipped all over the place – producer to market, market to turners and growers (1st price gougers), turners and growers to supermarkets (big overheads) sometimes via a central distribution warehouse. Non perishables go from manufacturer to stupid market direct most times or via a central distribution warehouse.
Lots of cost involved in the quadruple handling and massive cool storage (also stupid market drives producers to make visually appealing standardised produce at the expense of flavour) before you get charged $3 for a horrible little bitter middle class bourgeoisie salad garnish. Why do you all hate Brussels sprouts and cabbage so much?
Taking GST of fresh produce will just create stupid things like free kettle chips with a $2.50 carrot to get around the law. Or a small salad with bun,2 x cheese,2 x meat patty , sauce and gherkin. used to be called a Big Mac.
Comment by andy (the other one) — April 26, 2010 @ 5:10 pm
I have the opposite problem in Kerikeri. The lifestylers up here who populate our farmers market are more expensive than the local New World. Giving up those highly paid corporate jobs in Auckland and trying to remake their lives as lifestylers is an expensive enterprise (as I have sadly found). Doesn’t stop all the wives walking around like smudged versions of Felicity Kendal though.
Comment by Barnsley Bill — April 26, 2010 @ 5:28 pm
Kerikeri was lost as soon as you got ‘The Warehouse’, it has nothing to do with over indulged Paul Holmes alikes selling free range eggs on Saturdays at farmers markets. Use your invisible hand, I personally am looking forward to the new ‘New World’ in Mt Roskill opening soon. Never again Foodtown, never again…
Comment by andy (the other one) — April 26, 2010 @ 5:47 pm
I get mine free. From the garden. If I can do it. . .
Comment by Stephen Stratford — April 26, 2010 @ 6:15 pm
Rather than arguing about a GST cut that won’t get passed on by our duoploy supermarket chains anyway, how about some ferocious anti-cartel laws to force them to break them and provide genuine competition?
Comment by Sanctuary — April 26, 2010 @ 8:08 pm
Next thing you’ll be suggesting that we unbundle all the telephone exchanges and make MTR’s cheaper. Communist.
Comment by dontsurf — April 26, 2010 @ 8:11 pm
local supermarket has an incredibly limited range of citrus, which is frustrating. meanwhile the markets have mandarins and NZL oranges. the kicker is that the local citrus is all a little blemished, so it look like the supermarket isn’t picking it up…
we worked out that we saved around 30% of our produce bill each week by not purchasing from New World. things like coriander for $1 a bunch instead of $4 soon start to add up.
Comment by Che Tibby — April 26, 2010 @ 9:50 pm
Non perishables go from manufacturer to stupid market direct
Sure, because manufacturers dont have any inputs, they just magically create non perishable food items out of air.
What you’ve tried to do there is described pretty much the full production process for fresh beans, and then compared it to less than half the production process of Watties baked beans.
As far as anti-market argument goes, that’s pretty fucking stupid.
Comment by Phil — April 26, 2010 @ 9:55 pm
we have a little courtyard where we wage war against the Insect World over various small amounts of herbs and salad material.
What we salvage is much nicer than what we get from the supermarket.
generally we our vegies from an asian market, which is on the whole good but still a lot of that comes from cool storage.
Comment by Neil — April 26, 2010 @ 9:59 pm
Chump change— there writes a man with a thick middle class hide.
As a grower part-time, I can attest to the power of duopoly to grind down suppliers, with a hefty commission for the pleasure, but that hardly compares with the stringencies of watching an old person make $12k p.a. cover heating, transport & medical bills as well as the attempt to eat enough to sustain life- all afflicted with a soon-to-be 15% impost. I can’t comment on family raising costs these days, thank God, but without wff to subsidise cheapskate employers (and conmsumers), I guess we’d have way more than 20% of children living below internationally defined poverty lines. The chumps out there are operating on very slender pickings.
As I said when I began, some of you commenators have have damn thick hides.Next time you do go to the supermarket, remember that too often those shelves are loaded in the wee small hours by kids who should be sleeping to ready themselves for attending to their educational needs. And the GST you pay means a damn sight less to you than it does to the parents and caregivers of the majority.
Comment by Galeandra — April 26, 2010 @ 10:50 pm
fresh coriander: foodtown vs asian supermarket
Comment by EbolaCola — April 26, 2010 @ 11:03 pm
@Barnsley_Bill – come down to Whangarei on Saturday mornings. The grower’s market operates on the general premise of feeding the family rather than niche stuff by part-time hobby growers that costs a silly price.
I don’t know if Kerikeri is part of Chris Fortune’s empire, but Whangarei isn’t affiliated – its run by an actual grower.
Comment by Bell — April 26, 2010 @ 11:09 pm
I suspect it is so cheap because it is not of the quality that P&S and Countdown want, which makes it hard to sell at a high price, so T&G and Freshmax hock it off cheap and the markets can sell cheap but at a good margin. I suspect they don’t pay much tax either…
Most of the fruit and veges from the hutt market are cheaper (except kumara – must be a supply cartel there) but the quality can be marginal – the fruit often doesn’t last, especially in warm weather. The people selling look like they are selling their own greens but most of the rest is what they buy from wholesalers.
AS for why the supermarket prices are high, well I suspect it’s a bit like McD’s – you pay not only for what you buy but what they throw out , which appears to be quite a bit, and for the quality control. Fresh fruit and veges are apparantly the highest margin products in the store.
Comment by insider — April 27, 2010 @ 1:52 am
@Bell, have tried Whangarei. It is a great market. However. Rising an HOUR earlier on a Sunday to drive anywhere and save a few cents will never make my bucket list. My earlier comment re New World keri should not be viewed as support for that store. Despite the fact that it is a shiny new shop that seems to have a very high ratio of staff to customers it is ridiculously expensive.
An earlier commenter suggested that the warehouse is to blame in Keri. On the contrary. The clowns who allowed themselves to be manipulated into opposing a warehouse in Keri have seen a new shopping centre pop up in Waipapa down the road centred around the red shed and sucking shoppers out of the central Keri area. Which menas we now have in excess of 20 cafes, half a dozen clothing shops for middle aged women and a rash of very sad real estate agencies with not much else. Any retailer worried about the warehouse is an idiot. Lease space next door, find a niche and bask in the glow of massive foot traffic.
Comment by Barnsley Bill — April 27, 2010 @ 7:02 am
“I suspect it is so cheap because it is not of the quality that P&S and Countdown want, which makes it hard to sell at a high price, so T&G and Freshmax hock it off cheap”
generally these things are auctioned. the big players sweep up all the good stock, and the markets pick up what’s left.
tell you what, getting out of bed at 4am to squabble over produce is not a job i want to do again.
Comment by Che Tibby — April 27, 2010 @ 8:08 am
“generally these things are auctioned. the big players sweep up all the good stock, and the markets pick up what’s left.”
good in terms of what it looks like, or what it tastes like?
Comment by kahikatea — April 27, 2010 @ 8:16 am
if i remember correctly, almost entirely on look. blemish-free fruit of the right colour was the must-have.
small players generally didn’t even approach the flash stuff unless the supermarkets weren’t around.
mind you, this was 20 years ago. the game might have changed with big players like progressive driving costs to rock-bottom.
Comment by Che Tibby — April 27, 2010 @ 8:35 am
@kahikatea
it is all about visual appeal. I used to work in the packaging industry and foodtown/countdown have a specific type of lightbulb they use in store and packaging is designed and quality controlled for the specific lights. Can’t do much about veges but they look for lack of blemishes, standardised sizes etc.
@Phil
I never described the inputs of any production, I was trying to explain that for veges its lots of time sensitive quadruple handling that makes for higher prices at stupidmarkets. No need to drop f bombs about anti-markets, what ever they are.
Comment by andy (the other one) — April 27, 2010 @ 8:39 am
other andy says: “supermarkets (big overheads) ”
Aren’t a lot of the “farmers” markets run on ratepayer-funded council carparks? Doesn’t the council have to clear up the mess when market is done? Are the sellers passing on 1/9th of their takings to the consolidated fund to pay for WFF and “our” children’s education? Can you track down one of the sellers when norobug hits? Do the sellers display a food handling certificate? Are they exempt? Do they pay ACC levies for the child that takes your money and spends 5 minutes calculating your change in the hope thay you say “don’t worry dear, keep the change”? Don’t supermarkets have to jump through hoops in order to get resource consent? For example: “farmers” markets don’t have to provide x number of carparks per 100 customers, paid for out of their own pockets. And supermarkets pay shit loads of rates. Do “farmers” pay any rates, Andy?
Comment by Clunking Fist — April 27, 2010 @ 1:47 pm
In conclusion: supermarkets are currently the most efficient way of getting goods and produce to us city folks in a mostly LEAGL, SAFE and ACCOUNTABLE manner. I give them two thumbs.
Comment by Clunking Fist — April 27, 2010 @ 1:49 pm
“The people selling look like they are selling their own greens but most of the rest is what they buy from wholesalers.”
Whangarei grower’s market they’re not allowed to do that. What’s sold has to be what’s grown by the seller. I think the same can’t be said of the Farmers Markets that are in the FMNZ – I think they work on 80% local or something.
Clunking Fist, IRD are well aware of the hidden economy and take special interest in cash-based businesses and how to “educate” them – in the same way they’re currently making Trade-me sellers feel special. Market sellers are on public display in the middle of town, where IRD investigators shop. They’d have to be dumb not to be paying their dues – they’re much easier to catch out than drug barons. And farmers do pay rates of course. As for food stall hygiene, surely council bylaws cover that.
Comment by Bell — April 27, 2010 @ 10:47 pm
“generally we [get] our vegies from an asian market, which is on the whole good but still a lot of that comes from cool storage.”
Decent quality spring onions at Fruit World Mount Albert (in the Asian shopping complex at 955 New North Road) go for about 99 cents a bunch most of the time, usually a better deal than Pak ‘n Save up the road and certainly better than Foodtown/Countdown prices.
It’s usually not too hard to tell what’s genuinely fresh and what’s been hauled out of cold storage, and somehow I feel better giving these guys $20-30 of our shopping spend a week, which would otherwise go to Foodstuffs via Pak ‘n Save.
Comment by Sam Finnemore — April 28, 2010 @ 9:46 am
“which would otherwise go to Foodstuffs via Pak ‘n Save.”
Well, it would go to the owner and employees of the local Pak n Save. FS is a cooperative, not one of them evil global congloms.
“Market sellers are on public display in the middle of town, where IRD investigators shop.”
Yes, those traders carry all their IR348s and GST101s with them in the back of the truck.
/incredulity
Comment by Clunking Fist — April 28, 2010 @ 1:27 pm
@CF
“Well, it would go to the owner and employees of the local Pak n Save. FS is a cooperative, not one of them evil global congloms.”
I think Pak n Save is wholly owned by Foodstuffs. New World and Four Square are the locally owned co-op arms.
Comment by dontsurf — April 28, 2010 @ 1:43 pm
A dispute over price fixing at the Gisborne Farmers Market has been settled by the Commerce Commission.
In future prices will be set by individual stall holders rather through a market committee.
Glad to see the ComCom on the job…er, sort of.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10641388
@fist
I don’t hate supermarkets, don’t particularily care for them either so I send the missus. Mobile hot food vendors should have a food hygene cert somewhere on display.
Comment by andy (the other one) — April 28, 2010 @ 1:52 pm
“I think Pak n Save is wholly owned by Foodstuffs. New World and Four Square are the locally owned co-op arms.”
No, they are all privately owned. Foodstuff is the co-op group that all the owners/stores belong to.
*Technically there are 3 regional FS co-ops, I believe.
Comment by Clunking Fist — April 30, 2010 @ 3:10 pm