Commerce Commission

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 »

Bully Boys at Countdown throw their toys out of the cot

After being busted by their suppliers for mafia style stand-over tactics and trying to run a whispering campaign against anyone who welched on them to the Commerce Commission, Countdown are now throwing their toys out of the cot and refusing to attend the Food & Grocery Council conference laters in the year.

There were rumbles around the bar leaners at last years conference from suppliers about Countdown’s behaviour, and it has come to a head this year. They only have themselves to blame, but they continue to blame the industry representative group and have former National party president Sue Wood running around putting pressure on people.

The latest tactic to pressure the FGC into silence is to withdraw from the conference.

I’m pretty sure that Foodstuffs will be pleased with that, having unfettered access to all the suppliers in a convivial atmosphere without the interference of the team from Countdown.

Dave Chambers seriously needs to get a grip and stop playing the bear in the pit. Whilst a few dogs will get mauled ultimately the bear winds up dead.

Supermarket giant Progressive Enterprises will snub its suppliers’ annual industry conference because it has been stung by allegations it bullied them, the Australian-owned company that runs the Countdown chain has confirmed.

But suppliers are reporting an improvement in their relationship with Progressive, says the Food and Grocery Council (FGC).

The council, which represents suppliers, backed claims made in Parliament early this year by then Labour MP Shane Jones that Progressive was demanding retrospective payments from suppliers under threat of having their products removed from supermarket shelves.    Read more »

New job for Clayton Cosgrove?

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2014 has been an unmitigated disaster for supermarket giant Countdown.

With the Commerce Commission’s investigation in full swing and, from what I’m hearing they’re leaning towards believing the suppliers over the bullies at Countdown’s head office, things are not going well for NZ boss Dave Chambers.

Maybe Dave Chambers would like to try the stunt its owners at Woolworths are now watching roll out in Australia with its arch rival Coles.

Coles has decided it needs to “rebuild bridges with grocery suppliers” and has hired former Victorian Premier Jeff Kennett to oversee a new supplier charter.   Read more »

Countdown proves they are bullies, now posturing against the FGC

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2014 has been a fiasco for supermarket bully Countdown.

It kicked off the year bullying Kiwi suppliers with threats of being black-listed unless they ponied up with additional payments.

Then Countdown tried to call Shane Jones and Clayton Cosgrove’s bluff by sending threatening letters to the Commission Committee.

After the Commerce Commission announced there was sufficient evidence to launch an inquiry into Countdown’s behaviours, the company decided a new PR offensive was needed.

They fly in their Australian boss Ralph Waters, who then conveniently forgot about 15,000 of their “team members” and said it was a case of Aussie bashing.

Wheeling in an Australian boss to tell Kiwis they had it all wrong worked well for them with WOBH’s supermarket sources saying Countdown’s market share taking a hammering.  Read more »

Are Woolworths Aussie owners getting ready to dump Countdown managers?

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Via the tip-line

Countdown’s ongoing PR debacle seems to be taking a nasty twist with rumours out of Australia saying the Aussies are preparing to throw Dave Chambers and the NZ management team under the bus.

Word reaching WOBH is that Woolworths are undertaking “research” on NZ suppliers – specifically asking what suppliers think of the managers of Countdown.

Now you could pass this off as usual market research to help understand how the company is perceived with its customers and suppliers. Nothing to see here, move on.

But when taken in light of the Commerce Commission investigation into Countdown’s Godfather tactics with NZ suppliers, a more sinister element starts to emerge.   Read more »

Dobbing in rorting ratbags

Finally someone ready to take their head out of the sand to attempt to address the cartel behaviours of the construction material suppliers.

Anne Gibson reports:

The Commerce Commission is so concerned about construction industry cartels, price-fixing and bid-rigging that it has launched a website calling for whistleblowers.

Kate Morrison, the commission’s competition general manager, said the site -construction.comcom.govt.nz – went live partly as a result of Canterbury’s rebuild but also Auckland’s busy building sector.

“It is widely acknowledged internationally that corruption, fraud and anti-competitive practices, for example price-fixing, bid-rigging and market sharing, occur after natural disasters.”

And it wasn’t just Canterbury; rorts could be widespread in other parts of the country.

“The idea for a website arose from our work with the sector in the last few years. We saw a need for a user-friendly guide specifically tailored to the needs of construction businesses and workers to help them understand and comply with the laws we enforce.”

Read more »

Greedy ISPs refusing to pass on savings

Matthew Hooton and a collection of greedy ISPs mounted a campaign to lower the core costs of broadband…labelling the higher prices a “Copper Tax”.

Now that prices have dropped those same ISPs, who were saying that consumers would pay higher prices, aren’t passing on those savings to consumers.

The whole campaign was a fraud and now it is revealed as such.

Hamish Fletcher reports:

Internet companies will enjoy a reduction in some of their wholesale costs in December but aren’t committed to passing on these savings directly to consumers then.

Cuts to what infrastructure company Chorus charges internet retailers like Vodafone and Orcon for some wholesale copper-line broadband services are due to come into effect on December 1.

While two different price changes made by the Commerce Commission will come in on that day, Chorus has requested a wider review of both sets of prices from the regulator.

Although it had been aiming to have both reviews completed by the time the new pricing came into force, the commission on Thursday said it now planned to have a draft decision on both sets of prices by December and a final decision in April.

This means the price change will be in effect for at least four months before any possible change the commission could make in its final rulings.

But while internet providers will enjoy some lower wholesale costs over this time, none are committing themselves to lower prices for customers straight away in December.

Maybe Chorus should employ Hooton to put the acid back on the ISPs, what a surprise they aren’t passing on the savings.    Read more »

Oh dear, sounds familiar here too

Coles

I’ve forgotten how many weeks it’s been for Countdown’s PR mess thanks to Shane Jones’s exposing their mafia stand-over tactics against Kiwi suppliers.

Now we see Australian supermarket giant Coles up s**t-creek without a paddle.

The Australian watchdog the ACCC has fired a 50cal Gatling gun against this supermarket for similar tactics Countdown is under the pump in New Zealand for.

“The ACCC alleges that in relation to 200 of its smaller suppliers, Coles required agreement by the supplier to the rebate within a matter of days.  If these suppliers declined to agree to pay the rebate, Coles personnel were allegedly instructed to escalate the matter to more senior staff, and to threaten commercial consequences if the supplier did not agree.  The ACCC alleges that, in a number of cases, threats were made when suppliers declined to agree to pay the rebate.    Read more »