Supie, an online alternative to traditional supermarkets, plans to open in Auckland

Tuesday, 13 April 2021

A new online supermarket hopes to inject new competition into the industry when it opens in Auckland next month.

Supie founder Sarah Balle grew up on a vegetable farm in Pukekohe where she saw edible produce being wasted because it did not meet the cosmetic standards of traditional supermarkets.

“With the margins that food producers get along with the amount of food poverty we experience in New Zealand, I thought there must be a better way,” she said.

The supermarket industry is under the microscope as the Commerce Commission examines the impact of the powerful duopoly in its latest market study.

Sarah Balle is set to launch an online supermarket that will focus on sustainability and access for local producers.

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As well as looking at competition concerns in the industry, the commission has sought information about suppliers’ trading relationships and bargaining power with supermarkets and wholesalers.

The market study is expected to be delivered to the Government in November.

Balle, a former accountant, said she had been working on membership-based the online supermarket concept for several years.

She spent the past 18 months travelling the country talking to producers and sourcing products for her store.

Supie would have an emphasis on local producers and farmers market style produce, Balle said.

This would give producers access to new customers, she said.

Supie is an online supermarket platform that will offer customers more sustainable options at prices comparable with the larger grocery companies, founder Sarah Balle says.

“One of the big issues for producers is that its quite tough for them to get access to supermarkets and having their products on the shelves.”

Deliveries out of Supie’s south Auckland warehouse were planned to start in May, she said.

Twenty people had been employed, with another 30 to be added over the next few months, Balle said.

Supie plans to ship grocery boxes from a south Auckland warehouse.

Customers could choose a free membership with paid for delivery, or pay $99 for yearly membership with unlimited free deliveries, Balle said.

Expansion beyond Auckland would depend on demand, she said.

“We want to grow the business sustainably, once we’ve proven the business model, we’ll seek further investment to take Supie nationwide.”

Balle declined to say how much it cost to set up the business.

“We are running a lean model, so we can pay our suppliers more and charge customers fairly. I would say all of our prices are comparable to traditional supermarkets but as we grow, we do want to make food more affordable.”

About 2500 products would be offered including staples like bread, milk, pet food and toilet paper.

By comparison, Pak 'n Save Mini stores stock about 2500 key products, and larger Pak ‘n Save stores sell about 8000 products.

Auckland University of Technology senior marketing lecturer Megan Phillips said the success of new grocery businesses really depended on what added value they could offer customers.

If Supie could establish an e-commerce business model that could deliver greater convenience, or align with people’s values, then it had a way into the industry, Phillips said.

“There is a particular type of consumer that will be interested in buying from this type of supermarket,” she said.

“The reason supermarkets don’t widely have ugly fruit and that sort of thing is people don’t actually want to buy it.”

Customers that understand why produce might look like that, or have better understanding of the growing process, might be more willing to support a retailer where ugly fruit and vegetables were the norm, she said.

“So, they need to create value for that consumer.”