Election Hoon: How should the supermarkets duopoly be broken up?

National, Labour, NZ First, the Greens and Te Pāti Māori have all released policies for major state intervention in the supermarkets sector to break up or challenge the duopoly of Foodstuffs (Pak n’ Save, New World & Four Square) and Woolworths in recent weeks.

National and NZ First have proposed breaking up Foodstuffs into separate competing Pak n’ Save and New World/Four square chains, while leaving Woolworths intact.

Labour has proposed forcing both Foodstuffs and Woolworths to run their wholesale operations independently from their retail stores in a structural separation that echoes the breakup of Telecom into Chorus and Spark.

The Greens have proposed to break up the supermarkets duopoly and force the sale of 120 stores and distribution centres from both Foodstuffs and Woolworths to a new state-owned competitor called KiwiMart, at a cost to buy and invest in the new operation of $2.8 billion.

Te Pāti Māori has proposed providing a $800-$1000 per year tax credit for people earning less than $60,000 per year to be able to afford to buy eight weeks worth of kai. It would cost $2.8 billion a year in lost tax revenues. It has also proposed the Crown invest $100 million to support the creation of Māori run competitors to the duopoly.

I discussed Labour’s proposal on Monday with Labour Commerce and Consumer Affairs Spokesperson Arena Williams and Monopoly Watch NZ founder Tex Edwards.

The full discussion is in the video above.

Tex’s position on what is needed to foster real competition that generates lower prices for consumers includes this checklist of necessary conditions:

* Distribution centre competition: Most competitive tension occurs at the distribution-centre level. It is inevitable that new centres will need to be built.

* Scale competition: Modelling shows that a minimum of approximately 18–22% revenue market share is needed to deliver a pathway to cost-out reductions.

* Geographic competition: Competition is currently thwarted because whole suburbs and districts are served by only one banner. This needs to be resolved.

* Data break-up and open access: It is 2026 — data and digital access are now as important as geographic distribution, particularly with the emergence of robotic, AI-driven distribution ecosystems built for direct home delivery in the dry-goods segment.