Battlelines drawn as foodies’ revolution sparks store wars
Supermarkets and grocers are vying for slice of $20b pie, report Tom Pullar-Strecker and Simon Maude.
New Zealanders’ love affair with fine foods is transforming the luxury food market, bringing posh nosh out of the deli and into the aisles of big chain supermarkets.
Our seemingly insatiable appetite for quality food products has seen an explosion in the number of supermarket offerings in major centres, and the competitive market has left stores in one luxury chain with an uncertain future.
Auckland specialty store Nosh Food Markets has begun offering to spin off its stores as privatelyowned franchises.
Nosh posted an operating loss of almost $1.9 million in the year to June to its NZX-listed owner Veritas.
Veritas chairman Tim Cook said it was looking at all options for Nosh, though there were no plans to close any of its eight stores.
‘‘No decisions have been made at this point on where we are going to go or what we are going to do,’’ he said.
There are 10 supermarkets in a three square kilometre area in central Auckland.
Former Masterchef host Simon Gault, who supplies a range of foods to supermarkets including Nosh, said customers were demanding that stores raise their standards. ‘‘You want to feel like you’re somewhere where people care about food.’’
As a nation New Zealand spends nearly $20 billion a year on food and our collective grocery bill rose 10 per cent, year-on-year, in the three months to the end of June – way above the rate of inflation or the country’s population increase.
Wellington retail analyst Chris Wilkinson said the speciality food sector had almost become a victim of its popularity as New World supermarkets also cashed in.
While rival Countdown had followed a ‘‘cookie cutter’’ model, New World stores had engaged with local artisan suppliers and tried to mirror their area, for example catering to the tastes of the many Brits in Hawke’s Bay.
‘‘It has increasingly challenged the specialty retailers,’’ he said.
Even if they weren’t moving upmarket, supermarkets around the world were dumping the worst of their socially-questionable ‘‘pile ‘em high’’ practices, Wilkinson believed. ‘‘Consumers are rapidly disengaging from the ‘buy three for this price’ model.’’
Niche businesses could thrive on the crumbs if they could maintain ‘‘a small company feel’’ and a sense of authenticity, he said.
That could mean finding new products and stocking them only for a few months.
Acclaimed Auckland based television chef Michael Van de Elzen echoed Wilkinson’s words.
Unlike supermarkets, the gourmet stores can also quickly ‘‘change-up’’ their product lines offering customers new and exciting foods, something the bigger chains struggle to do, he said.
But whether or not it’s worth the trek to go gourmet food shopping is another matter, he said.
And once shoppers go shopping it’s more than likely that the one of several supermarkets could supply their increasingly eclectic appetites.
New Zealand Food & Grocery Council chief executive Katherine Rich said New Zealand has one of the highest per capita rates of supermarkets in the world while central Auckland supermarket growth ‘‘isn’t surprising’’ given the area’s large population growth.
Within around three square kilometres of central Auckland, there are now 10 supermarkets, with new Countdown stores challenging established smaller boutique food outlets Nosh, Farro
You could probably argue what people value more, the product on the shelves or the advice you get? Michael Van de Elzen, left
Fresh and Sabato. Rich said new supermarkets took business away from older outlets by piquing shoppers’ curiosity.
Sunday Star-Times food writer Jordan Rondel said New World and Countdown were now one-stop shops for foodies.
‘‘That’s a massive part of it, the new Countdown that opened up in Ponsonby, they’ve got make-yourown almond butter, craft beers and lots of little organic teas, lovely high end stuff.’’
Which must be little comfort to Nosh’s established Ponsonby Rd store, a few hundred metres away.
Van de Elzen believes gourmet food retailers still had a market.
‘‘You could probably argue what people value more, the product on the shelves or the advice you get?
‘‘For instance, at Sabato you look at a whole counter of cheese and you have no idea – but the person behind the counter can help.’’
Retail NZ public affairs manager Greg Harford said there was a growing demand for more unusual goods. Illustrating the point Harford says his 11 year-old child’s ‘‘signature dish’’ is coconut tofu and blackened tempeh with yuzu sauce.
‘‘We are a very culinary family!’’