Cheapest supermarket revealed - but when is a special no longer a special?

Thursday, 6 October 2016

Consumer NZ said it could be hard for shoppers to know if they were getting a real discount.

Consumer NZ's annual supermarket price survey has named Pak'nSave as the cheapest place to do your grocery shopping.

Consumer NZ chief executive Sue Chetwin said prices were collected for a basket of 30 popular grocery items over a seven-week period at Countdown, New World and Pak'nSave stores.

Shoppers visited supermarkets in north Auckland, east Auckland, Hamilton, Wellington, Christchurch and Dunedin.

They tracked prices for seven weeks for a list of 30 everyday household products. The list included food and drink as well as personal care and cleaning items. The survey didn't include fresh meat, fish or produce because for a fair comparison quality would need to be considered. Wine and beer were also excluded.

'Pak'nSave stores came in with the lowest prices, retaining the place the chain has held in nearly every survey over the past 15 years,' Chetwin said.

Prices were closer at New World and Countdown. On average, the cost of the groceries at New World was about $3 to $5 higher than Countdown. The exception was Hamilton where there was little difference.

But when is a special not a special?

Chetwin said more than half the products tracked over the seven weeks were regularly on promotion.

'Price promotions can save consumers money. But we found some products are being discounted so often, shoppers have grounds to question whether the specials are really all that special,' she said.

Items regularly marked down included household staples such as butter, bread, coffee, jam, yoghurt, pasta, snack bars, dishwashing liquid and shampoo.

Some items were on promotion almost every week, such as a 250g block of Whittaker's chocolate.

At Countdown stores, the usual price was shown as $4.99, Consumer NZ said.

But it was almost always on promotion for $4 or $4.50. 'We saw a similar trend in our 2015 price survey. Back then, the usual price was $4.90 but it was frequently marked down at prices ranging from $4 to $4.50.'

The chocolate was also regularly on special at New World. At all six stores shoppers visited, it was on special more weeks than it was sold at the regular price.

'Price promotions have become the new normal in supermarket aisles. But shoppers face an unenviable task wading through the advertising noise to work out if they are getting a genuine bargain,' Chetwin said.

University of Auckland marketing specialist Bodo Lang agreed it was an issue for shoppers.

'Prices are often discounted so heavily that it is difficult to make out what is a good deals and what is normal pricing. This can affect brands such as Cadbury which has been discounting prices for a long time to reclaim lost market share from Whitaker's,' he said.

'Some retailers combat this issue with what is called EDLP, everyday low pricing, in an attempt to make the highly complex marketplace more transparent for consumers and to take complexity out of pricing.'

Pricing practices have earned both Foodstuffs and Progressive Enterprises a place on the Commerce Commission's roll of the most complained about traders. Foodstuffs owns the New World and Pak'nSave brands. Progressive enterprises owns Countdown.

Consumer NZ has called for regular price monitoring to ensure consumers aren't being misled about special prices.

Stores advertising special offers must be offering a genuine deal. 'If the savings aren't real, retailers risk breaching the Fair Trading Act,' Ms Chetwin said.

New Zealand shoppers are some of the most promotion-sensitive in the world.

The supermarket chains have been approached for comment.

Results

AUCKLAND

(North)

Pak'nSave (Albany) 1st

Countdown (Glenfield) 2nd

New World (Birkenhead) 3rd

AUCKLAND

(East)

Pak'nSave (Glen Innes) 1st

Countdown (St Johns) 2nd

New World (Eastridge) 3rd

HAMILTON

Pak'nSave (Mill Street) 1st

Countdown (Te Rapa) 2nd equal

New World (Te Rapa) 2nd equal

WELLINGTON

Pak'nSave (Lower Hutt) 1st

Countdown (Lower Hutt) 2nd

New World (Lower Hutt) 3rd

CHRISTCHURCH

Pak'nSave (Northlands) 1st

Countdown (Northlands) 2nd

New World (Bishopdale) 3rd

DUNEDIN

Pak'nSave (Hillside Road) 1st

Countdown (Anderson Bay Road) 2nd

New World (Great King Street) 3rd