Duopoly: The numbers behind the Commerce Commission's call for a third supermarket retailer

On Thursday the Commerce Commission suggested the deliberate creation of a third supermarket chain might be required if attempts to break the "duopoly" through natural competition don't work.

Woolworths NZ (Countdown, Fresh Choice, SuperValue) and Foodstuffs (Pak'nSave, Four Square, New World) hold a "duopoly" according to the commission's market study into the retail grocery sector draft report. 

Countdown said the report's recommendations would have "significant implications" for its business.

So how did the commission come to such a bold conclusion? Here's the numbers behind the report. 


How many companies effectively control the grocery market in New Zealand.


The percent market share the two companies have - at least - for main shopping trips. 

$22 billion

The size of the grocery market in New Zealand.


The average spend for households per week.

3 million

How many people shop at a Countdown-owned store each week. 

3.3 million

How many shop at a Foodstuffs store each week. 


How many stores Woolworths owns directly or franchises.

More than 400

The number run by Foodstuffs NZ. 

The duopoly. Photo credit: Getty Images/Newshub.

21.6 and 23.8 percent

The 'return on average capital employed' by the duopoly between 2015-2019. This is well above the Commerce Commission's estimate of a normal rate of return - between 4.6 and 6.1 percent.

5.4 percent

Foodstuffs South Island's earnings before interest and tax profit margin in 2019 - well above the international margin of 3.1 percent (the company's margin in 2011 was even higher, at almost 7 percent). 


Where New Zealand ranks in the OECD group of 38 countries in terms of both grocery spending per capita and prices. Taking out highly-taxed cigarettes and alcohol barely makes a difference to the ranking. 


The number of years since a major player - The Warehouse Group - tried to upend the duopoly. It gave up two years later. 


The number of years until US retailer Costco opens its first New Zealand store - though the commission doubts it will "significantly improve competition except for niche groups of consumers or types of shopping mission".


The number of covenants the duopoly have on land "restricting a competitor’s food or retail grocery store development". More than 50 of them are indefinite or last longer than 20 years. 


How much you need to spend at Countdown to earn a $15 voucher - a reward of just 0.75 percent. 

59 percent

The percentage of items Kiwis buy that are on 'special' at the time of purchase. 

5.7 percent

How much grocery spending is now done online - behind Australia (5.9 percent), the UK (11.4) and China (25), thanks to a lack of innovation. 

95 percent

What percentage of Kiwis use either a Countdown or Foodstuff-run store for their main shop exclusively. 

34 percent

How many Kiwis said they don't know what their supermarket does with the data gained from their loyalty card.