Grocery hikes will impact on discretionary retail

Media release

Newmarket Business Association

14 February 2008

Grocery hikes will impact on discretionary retail

The latest Statistics New Zealand figures showing the price of groceries up eight percent in the year to January, will be putting a squeeze on the country's other retailers, claims Auckland's leading shopping precinct.

"If a family is spending about $250 a week on groceries, and prices go up by eight percent, then that family has to find a $1,000 from somewhere else in their annual household budget," said Cameron Brewer, general manager of the Newmarket Business Association.

"When fixed costs like groceries go up retailers selling more discretionary items such as clothing, homeware, furniture and electronics will be affected.

"This is significant news when you consider how much money and time New Zealanders spend in supermarkets.

"Grocery price hikes are not just bad for supermarket shoppers. Ever increasing fixed costs and a constant squeeze on the discretionary dollar negatively impacts all retailers as the pie simply gets smaller. It wouldn't be a problem if wages and salaries had gone up by eight percent as well," said Mr Brewer.

ENDS

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