Commerce Commission

Bring back Dave – All is forgiven

After the PR debacle Countdown went through telling Kiwi suppliers that ‘all is well, we’ll look after you’ during a Commerce Commission investigation, you’d think Countdown would get back to basics.

But their recent print ad seems to suggest they’re having an identity crisis and now want to be a hardware store.

Mark Reynolds, who in between being the spin merchant for Todd Corp’s Nova Energy and picking fights with hater Giovanni Tiso and dreary Drinnan, posted a print ad for Countdown.

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Milford Asset Management are blaming “the web guy” – not taking responsibility

Milford Asset Management says it has contacted other KiwiSaver fund managers to explain an “inadvertent breach of conventions” in Google search terms used for marketing purposes.

This comes after rival fund manager Fisher Funds lodged a complaint about Milford’s use of its brand in a so-called “ambush marketing” campaign where it used other KiwiSaver providers’ names to try to attract potential customers to its own website by paying for search words.

Hence, when someone typed “Fisher kiwisaver” into Google, an ad for “Milford Fisher KiwiSaver” topped the search list with a link to the Milford website.

“It has never been our intention to use such tactics in our marketing,” Milford managing director Anthony Quirk said today.

Except that you were.   And this is yet another incident in Milford Asset Management’s murky existence.  You have to love it – a business that depends on trust more than most, and they simply don’t appear to care unless they’re caught.   Read more »

More unethical behaviour from Milford Asset Murkiness

The tip line is running hot with financial industry people contacting us with snippets of unethical practices by Milford Asset Murkiness, excuse me, Management. Thank you for the tips – we are working to ensure the FMA is made aware of some of the alleged behaviour of Milford.

One of the more intriguing tipoffs is the proven ambush marketing Milford are engaging in with paid Google search.

There is widespread abuse by Milford in ambush marketing using Google search. This is where they use the name of one of their competitors in their own paid search result to try and confuse the person searching about Kiwisaver.

For example, one of the smaller but fast growing Kiwisaver funds operators is a firm called Generate. I’ve never heard of them before now, but they’re obviously getting some traction as they’ve won some awards recently. But tellingly, they are the victim of Milford’s ambush marketing.

If you go to Google and search for “Generate Kiwisaver”, the first link that comes up is an ad for Milford. That’s not surprising, companies will often invest heavily in making sure their own name comes up ahead of competitors in Google searches relevant to their industry.

But what the Milford Ad says is very interesting and raises questions about their ethics.

Apparently, they call themselves in their ad “Milford Generate Kiwisaver”.

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NZ is the only country where Internet access is getting more expensive

Spark, Vodafone and Callplus together represent 94 percent of the residential internet market and all have put up their prices for home internet packages.

Internet service providers blame the rises on the Commerce Commission’s recent draft decision which reduced the price companies pay for use of the copper wire network.

The charges relate to what Chorus (the wholesaler) charges internet service providers and telcos like Spark, Vodafone, Orcon, Slingshot and Flip, for accessing their copper infrastructure which was deployed years ago by the Post Office. Those wires run down almost every street in the country and are the phone lines we have been using for decades.

Because it is a monopoly, the price that the wholesaler can charge is regulated by the Commerce Commission.

In 2011, when Telecom was split into a retail arm (Telecom) and a wholesale arm (Chorus), the Commission had to work out what Chorus’s wholesale services were worth, and what price they would charge internet service providers and telcos, including Telecom (now Spark) to use those services.

The price was originally set at about $45 per customer per month. Read more »

Which is easier, Andrew Little or Countdown PR job?

We’ve seen the fiasco that surrounded the recruitment process for a PR person to help people discover who Andrew Little is.

Now we see our favourite supermarket owner Progressive Enterprises (owners of Countdown) trying to boost their PR efforts after a dismal 2014.

You’ll remember how Countdown was under the pump while the Commerce Commission investigated more than 90 complaints from suppliers for their strong-arming of local suppliers.

The Commerce Commission surprisingly didn’t find anything… while in Australia, the ACCC investigated a remarkable similar story and slammed a supermarket chain (COLES) with millions in fines.

Countdown has some work to do repairing its reputation with suppliers in New Zealand. So let’s have a look at the job requirements and see how important supplier relationships are to Countdown.   Read more »

If brains were dynamite our Commerce Commission wouldn’t have enough to blow their nose

Our Commerce Commission recently received more than 90 complaints from suppliers being strong armed by Progressive/Countdown.

They had a cursory look and found…nothing.

Countdown, despite the more than 90 complaints claimed vindication.\Meanwhile in Australia, their ACCC has found a remarkably similar story…and slammed the supermarket chain they nailed with millions in fines.

Australian supermarket chain Coles will pay A$11.25 million in fines and costs and potentially far more refunding suppliers for illegally squeezing them for funds.

The food and liquor giant’s settlement with the Australian competition watchdog over charges of unconscionable conduct in its treatment of grocery suppliers was accepted by the Federal Court on Monday.

The nation’s second largest supermarket chain had deliberately and illegally misused its market power to squeeze small suppliers for money, judge Michelle Gordon told the court.

The verdict was welcomed by the Australian Food and Grocery Council, which also applauded Coles and Woolworths for working with it on a code of conduct.

However the industry body has warned members in writing about Woolworths also seeking to recoup money for “profit gaps”, although it has not facing any charges.

The payments to Coles filled what it called its “profit gaps” or targets, which in reality meant profit shifting and deducting money it was supposed to pay suppliers.

Because Coles represented a significant proportion of the small suppliers’ sales, it was able to successfully pressure them by threatening to stop buying their products, the court found.

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Woolworths Australia under investigation for same Bully Boy tactics as Countdown

Countdown claimed to be exonerated despite 91 complaints against them, after a report and investigation from the Commerce Commission.

Woolworths in Australia has the same owners as Progressive/Countdown in NZ  and our Commerce Commission let them off the hook after Shane Jones claims.

Woolworths is now being accused of the same bully boy Maia style standover tactics as has recently occurred in New Zealand and the Australian regulators are investigating.

WOOLWORTHS buyers have told suppliers their products could be pulled from shelves just days before Christmas if they refuse to fund the supermarket giant’s new Cheap Cheap advertising campaign.

“I was asked for a contribution of almost $1 million, and when I refused to pay I was told a ‘range review’ was underway and I would be informed of the outcome early next week,” said the sales manager of one of Australia’s leading health product companies.

“The implied threat is that some of my products will no longer be stocked if I don’t pay up.”

Woolworths staff have also been accused of telling suppliers the payment requests had the “endorsement” of the Australian Consumer and Competition Commission (ACCC) – a claim that the consumer watchdog rejects.   Read more »

Oh Countdown, why didn’t you quit when you were ahead?

 

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Not content to let a 9-10 month Commerce Commission investigation into your business practices rest after being ‘exonerated’, Countdown’s boss Dave Chambers has come out hitting against the country’s politicians.

His chief lobbyist, and Matthew Hooton’s mother in law, Sue Wood can’t have told him that politicians have very long memories and don’t take likely to being told what to do by businessmen.

Then again she might have, if reports out of Parliament telling of her aggressive lobbying of MPs are anything to go by.    Read more »

Comcom’s investigation into Countdown boils down to: What is an “ask”

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WOBH was one of first out of the blocks after Kiwi suppliers tipped us off about Countdown’s Godfather type behaviour, earlier in the year.

However today we see the Commerce Commission clearing Countdown from any anti-competitive behaviour, saying that it has investigated 90 complaints.

After a disasterous PR year for Countdown, its boss Dave Chambers is now on a PR offensive saying he’s been exonerated and that “the shadow of these false allegations” had been distracting for the company, alongside having a crack at former Labour MP Shane Jones.

All is not quite as rosy for Countdown as they would like, and the 90 complaints shouldn’t be dismissed quite so quickly. It’s not like it was one or two complaints… 90 complaints indicate they’ve got some “communication problems”.

To have ‘numerous suppliers asked that they not be identified’ should further demonstrate to Dave Chambers that all is not well with their supplier relationships.

The Commerce Commission’s observations that despite “Progressive’s conduct in each investigative case was not likely to be unlawful” they cautioned a number of parties, and included the warning:

exchanging information about future competitor behaviour, or discussing supplier interactions with a competitor. These types of exchanges create an environment in which anti-competitive agreements or conduct can 
easily emerge. This creates significant risk for the parties involved, including employees. Such exchanges and discussions should be avoided.

The Commerce Commission Report also says:

We accept that a smaller retailer may not be able to apply the same commercial pressure as Progressive. However, that in itself does not mean that Progressive has taken advantage of any substantial market power.

Meanwhile Labour’s Clayton Cosgrove is putting on a brave face and has issued a media release pushing for a mandatory code of conduct for supermarkets. He’s saying that:

The Commission was only able to look at the letter of the law. In Labour’s view the law is not strong enough. In Australia the ACCC is currently prosecuting Coles for anti-competitive behaviour and has a code of practice.

The UK has an independent adjudicator with a mandatory code of practice. In that country there are ten dominant supermarket players who effectively control 85 per cent of the market and that has been judged to be too much concentrated market power. In New Zealand there are two dominant players, with 95 per cent market share.

My spies in Parliament are telling me that Countdown chief lobbyist Sue Wood has been sent in to calm the horses. Gee that’ll be a welcoming sight.

 

Phil Twyford shows us yet again why Labour are idiots

In the election the Labour party presented us with a concept for lowering power prices…removing competition from the market, and having state control.

It was an idiot idea, from the party of idiots. All around the world the plan has shown to be a complete failure, yet Labour ran with policy on the heroic assumption that they could command the economy to lower prices by removing competition.

Then in today’s Herald we have another Labour idiot mouthing off about another industry, but his solution is to increase competition, in stark contrast to their power policy.

Labour’s housing spokesman Phil Twyford has raised concerns about anti-competitive building industry practices after the world’s second biggest wallboard maker said it was reviewing its structure in New Zealand.

Twyford is concerned about German-headquartered Knauf Plasterboard after it said its operation here was being examined. “A review of the Knauf Plasterboard New Zealand structure is currently under consultation,” Knauf said yesterday.   Read more »