Woolworths has explained why it plans to keep selling a particular item.
New Zealand-made dairy product
more affordable in Australia compared to what New Zealanders have to pay in their home country.
However, butter prices in the country known as the land of the long white cloud have surged by an astonishing 65 percent within a year, exacerbating the situation.
cost-of-living
Pressure on consumers this week saw a 400-gram block of New Zealand-produced Westgold butter priced at $6.50 (NZ$7.00) in Woolworths’ Australian outlets, whereas across the Tasman Sea, it retailed for NZ$9.95 (A$9.19).
The scenario is comparable for New Zealand-produced Mainland products, where 250 grams of butter costs A$8.15 in New Zealand compared to NZ$7.00 ($6.50 AUD) in Australia.
Woolworths clarifies variations in butter costs
Woolworths
acknowledged shoppers in both countries face cost-of-living pressures, and it claimed “delivering value wherever we can continues to be our priority”.
When it comes to butter prices, the company indicated trans-Tasman pricing is complex because it’s influenced by multiple factors, including tax and global markets.
“A variety of elements can affect the pricing of goods manufactured in New Zealand and sold both domestically and within Australia. Woolworths manages distinct purchasing systems in these two nations,” the corporation informed Yahoo News via an official statement.
For instance, when it comes to butter, New Zealand leads as the biggest global exporter. Presently, New Zealand’s retail prices for butter account for the rise in the international cost paid to manufacturers, which took effect on May 1. However, Australian pricing for the same item purchased prior to this date would still represent the earlier, lower worldwide price.
“Different tax arrangements and rates can be a factor, and purchase volumes and different promotional pricing activities can also influence retail prices on either side of the Tasman.”
Woolworths could not provide commentary regarding potential increases in butter prices in Australia once the new products are sourced from New Zealand.
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New Zealand faces challenges due to the high pricing from its supermarket duopoly.
Although there appears to be competitive activity within the New Zealand supermarket industry, similar to Australia, this market is largely controlled by two major players. Brands such as PAK’nSAVE, New World, and Four Square are under the ownership of the local cooperative named Foodstuffs. In contrast, Countdown and Woolworths operations are managed by Australia’s Woolworths Group.
The prices for butter were unexpectedly consistent across the country’s supermarkets, with Mainland priced at NZ$9.95 at New World andNZ$8.49 at PAK’nSAVE.
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The article initially appeared on Yahoo News Australia.
https://au.news.yahoo.com/woolworths-responds-to-glaring-pricing-issue-as-aussie-neighbour-loses-out-002701805.html
