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Speaker 1: Now Walworths well, speaking of the supermarkets, Woolworths has hit

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Speaker 1: back over claims that supermarkets are charging us too much,

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Speaker 1: instead blaming the government for it. Now they've released a

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Speaker 1: paper today and they say it's the GST on the

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Speaker 1: groceries that make our groceries more expensive than over in

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Speaker 1: Australia and the UK and now. Peter de Wet is

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Speaker 1: the intro managing director of Walworth's New Zealand. Peter, Hello,

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Speaker 1: hei the okay, So if you take the GST off

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Speaker 1: and the comparable taxes around the world, are we cheaper?

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Speaker 2: Absolutely. In the comparison we've done, which is to a

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Speaker 2: number of UK and Australian retailers, we end up being

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Speaker 2: about ten percent cheaper.

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Speaker 1: What are you You're not just choosing things that are

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Speaker 1: going to make it like You're not You're not gerrymandering

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Speaker 1: the situation. Are you by choosing things that are cheaper

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Speaker 1: in New Zealand?

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Speaker 2: No? Absolutely not. So we used the Choice shopping basket

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Speaker 2: and to give you a sense of what it did

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Speaker 2: to know, it's all the core core basics, things like milk, apples, garrets,

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Speaker 2: mince wheat, pigs, butter, toothbas shampoo, you know all the

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Speaker 2: core basics, so twiney real staple products.

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Speaker 1: How do we end up cheaper that like that? Well,

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Speaker 1: this is going to confound anybody who's ever done any

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Speaker 1: shopping around the world.

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Speaker 2: I think the reality there's customers. You know, this is

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Speaker 2: a comparison, but customers feel the pinch of having paid

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Speaker 2: a lot more for the groceries globally over the last

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Speaker 2: number of years. It's not only a New Zealand problem.

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Speaker 2: So I think the reality is if you if you

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Speaker 2: go and shop, it feels expensive. That's just the reality

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Speaker 2: of it.

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Speaker 1: Okay, So is it a case of us having higher

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Speaker 1: taxes or is it a case of the countries you're

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Speaker 1: comparing us to us to having exemptions on their groceries.

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Speaker 2: Well, the reality is they've got they've got a different

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Speaker 2: GSDY structure to us. So the bulk of the products

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Speaker 2: we've compared, about two thirds of them don't have GSD

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Speaker 2: on them. So it is a structural difference between the

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Speaker 2: three markets. And I just want to be clear, you know,

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Speaker 2: the reason we're pointing it out is not to say

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Speaker 2: GC issued or shouldn't be there. The only reason we're

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Speaker 2: pointing it out is because often we see comparisons out

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Speaker 2: in the media where people say we've so much more

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Speaker 2: expensive than these markets. But the reality is one's going

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Speaker 2: to compare apples of apples.

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Speaker 1: Yeah, so what are the exemptions they have got but

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Speaker 1: we don't.

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Speaker 2: So in both these countries. I'm not going to talk

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Speaker 2: through all the detail, but roughly, if I give you

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Speaker 2: a general assessment of it, fresh products in the main

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Speaker 2: are not are not covered under jest and neither are

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Speaker 2: like commodity grocery products.

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Speaker 1: Okay, you've also made the point that if the government

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Speaker 1: was to intervene, it would push up the price, potentially

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Speaker 1: buy as much as six percent. But what would it

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Speaker 1: be that would cause that price rise?

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Speaker 2: Sure, so I think that you know, from what we've

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Speaker 2: looked at the reality one of the challenges we've got it.

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Speaker 2: There's two big challenges in New Zealand. The one is

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Speaker 2: that we far away from everywhere, and the other one

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Speaker 2: is that we are small country, so scale is really important.

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Speaker 2: So if you take the existing retailers in the market,

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Speaker 2: if we were to let's just say, Louise twenty thirty

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Speaker 2: percent of our scale overnight, it would mean that our

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Speaker 2: costs are the relationship of our cost to total sales

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Speaker 2: we've changed dramatically overnight because of that loss of scale,

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Speaker 2: and therefore prices will by nature of that go up.

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Speaker 1: Okay, Now, when I saw this this morning, Peter, my

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Speaker 1: first thought was that you guys are firing a warning

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Speaker 1: shot over the bow of the government who've used you

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Speaker 1: as their whipping boys. Is that what you're doing.

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Speaker 2: That's definitely not what you're doing either. I think you know.

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Speaker 2: The reality of it is, we want the same thing

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Speaker 2: as the government. We feel the pane of our customers

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Speaker 2: every week, we all customers ourselves, and we want to

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Speaker 2: bring prices down. What we do want to make sure though,

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Speaker 2: is that through the idify process, which is actually a

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Speaker 2: really constructive process to date, is that we share factual

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Speaker 2: information as best as we can with the government for

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Speaker 2: them to make informed decisions. You know, if we can

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Speaker 2: get a better outcome for customers on price, that's a

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Speaker 2: great outcome. We just want to make sure that.

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Speaker 1: Yeah, but I mean to be fair, Peter, if you

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Speaker 1: were going to share information with the government, you can

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Speaker 1: share information with the government. You've chosen to share it

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Speaker 1: with the rest of us, haven't you.

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Speaker 2: Yeah, we shared it with the government first up, and

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Speaker 2: what you've shaid with the government is significantly more detailed

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Speaker 2: and we really hoping that we can work through it

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Speaker 2: with them. But to the reason we've shared it broader

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Speaker 2: is we want to make sure that customers know what

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Speaker 2: the facts are as well. Now that's not going to

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Speaker 2: make you know, we're also realistic about the fact that's

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Speaker 2: going to not make them feel better about what they

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Speaker 2: spend at the checkout next week, that's for sure, but

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Speaker 2: we do want them to know what the facts are.

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Speaker 1: Peter, as always, it's really good to talk to you.

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Speaker 1: Thank you for your time. Mate. That's Peter de wet

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Speaker 1: will Worst New Zealand into a managing director.

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