Labour’s supermarket stupidity

March 28th, 2014 at 3:00 pm by David Farrar

Labour announced:

New Zealand’s supermarket duopoly needs to do some serious explaining as to why their fruit and vegetables are so pricey, Labour’s Consumer Rights spokesperson Carol Beaumont says.

“An Otago University report shows Kiwi households are likely to be spending upwards of $2500 a year more on their fruit and veges if they buy them from a supermarket rather than their local market.

“Given ever increasing power prices and rising interest rates, there are not too many families that wouldn’t find an extra $49 a week in their pocket helpful.

“Unfortunately not everyone has access to a market, and the know that.

“It’s past time for some transparency around pricing.

“Under this Government it seems the rewards are concentrated at the top. Lower down the food chain everyone else appears to be getting a raw deal.

“Supermarkets don’t have to wait for the Commerce Commission’s report to change their behaviour.

“They could start now – by bringing their fruit and vegetable prices into line with local sellers.”

The reader who e-mailed this to me comments:

The stupid, it hurts! 

Seriously, oh my god! Are they really that dumb? Do they really think that a person selling goods at a farmers market has the same costs as a supermarket? 

Supermarkets have massive costs. advertising, power, wages for 1000’s of staff, time and a half, days in lieu, sick leave, stat days, holiday pay, … some of which gardeners have, but at a much smaller scale.

Small time and medium gardeners, some of which will not even have any staff, selling goods at markets will not have anywhere near the costs of a large supermarket, and lets face it, i’m guessing that half of them probably don’t even pay tax on the cash they get for their goods, let alone pay any GST. 

I give up, they really are that stupid. That 30% of the New Zealand public cant also see that astounds me even more.

Yes they are that stupid, or hoping enough NZers are.

As it happens fruit and vege prices are just 3.4% higher in February 2014 than five years ago in February 2009. That’s an average of just 0.7% a year.

And how much did fruit and vege prices rise from February 2006 to February 2009. A whopping 29.6% or 9.9% a year!!!

 

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56 Responses to “Labour’s supermarket stupidity”

  1. Colville (2,248 comments) says:

    $49/week more?
    So if the supermarket is 100% more ie twice the price people are spending $100 a week on fresh fruit and vege? really?

    I think that is total bullshit!

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  2. mikenmild (11,246 comments) says:

    Interestingly there was a study out this week finding a ‘halo’ effect where supermarkets closer to local markets had lower fruit and vege prices than supermarkets further away.

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  3. BeaB (2,104 comments) says:

    I think this is rubbish.
    Our farmers market stalls charge far more for their veg and I am always a bit suspicious about the safety of some of the unwashed organic stuff.
    The local greengrocer has good prices but the quality isn’t always the best and there’s not a lot of choice. Our two big local supermarkets can vary in price but the produce is always good quality. They also stock the range of veg I want so I don’t have to go to more than one shop – the whole point of a supermarket in any case.
    I cannot believe there is a $49 difference as any variations I see are usually only in cents and seasonal veg are usually cheap everywhere.
    I shop regularly at the supermarket but would go elsewhere if I could save that much a week.

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  4. Jim Rose (35 comments) says:

    did this study include the time, travel and other costs of shopping in two places.

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  5. redqueen (552 comments) says:

    ‘The researchers developed a hypothetical weekly “shopping basket” for a two adult, two child family containing ideal amounts of fruit and vegetables from a health perspective.’

    Always the best way to produce a good political argument, the ‘two adults and two children family’. I’ve got two kids and a wife, so they must mean me…

    But wait…

    ‘Fruit and vegetable markets were the cheapest at $76 per weekly basket. Online supermarkets were the next cheapest at $113, although this could be offset by delivery charges, says one of the study’s authors, Dr Amber Pearson. The difference between the cost of the basket at a fruit and vege market compared to a supermarket was $49 less at the market.’

    So they are assuming a ‘hypothetical family’ eats $125 per week of fruit and veg? My kids eat tonnes of the stuff, as snacks, as part of meals, etc. but it doesn’t cost anything resembling that much. If we spent $50 per week I’d be impressed and that’s at Pak N Save. If they think I’m eating another 1.5 times as much fruit and veg, they’re having a laugh. I must be eating far too much meat or something…

    ‘The researchers note that farmers markets also have the advantages of expanding consumer choice by providing more access to local produce and more “organic” produce – with such organic produce having lower pesticide levels.’

    So this is just political nonsense…oh wait, it’s a ‘report’ by Otago University and the Department of Public Health to boot…

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  6. adamsmith1922 (890 comments) says:

    Problem, this study is from Otago and often there are vege at the local Pak n Save which are same or cheaper than market.

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  7. cha (3,922 comments) says:

    Around half the price local supermarkets are charging.

    https://www.facebook.com/CrazyPumpkinWanganui

    edit: and Barbara’s Hill street greens is cheaper again

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  8. mikenmild (11,246 comments) says:

    There’s a very good fruit and vege market each week in the Hutt which is wayyyy cheaper than the three nearby supermarkets. Much better range of goods and choice between multiple suppliers too.

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  9. thedavincimode (6,606 comments) says:

    Liebore would also need to change the law that compels consumers to shop at supermarkets and prohibits them shopping around for the best deal.

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  10. PTM (47 comments) says:

    The third, cheaper and more satisfying option is growing your own fruit and veges. I wonder why Labour did not cover this option? A Google Earth trip through the lower social economic areas shows a dearth of back yard gardens.
    We grow enough through the warmer months to keep us well fed through the winter with frozen veges, plenty of jam and bottled fruit.
    If your budget options are such that you prefer to play a round of golf, or put your feet up, fine, but if you start complaining about the price of fruit and veges, get off your ass. What is it with the left? That is where self sufficiency should be the first option, not the one left out.

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  11. thedavincimode (6,606 comments) says:

    I am always a bit suspicious about the safety of some of the unwashed organic stuff.

    BeaB, only melon party members fertilise their organic crops with their own excrement. As long as the vendors don’t smell, have goatees, or beards in the case of male vendors, you’ll be fine.

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  12. Huevon (213 comments) says:

    Carol Beaumont’s release meets the four criteria for a Leftist policy: (a) it misrepresents statistics ($2,500 more!) (b) it appeals to vague notions of social justice (think of the Kiwi families!!); (c) it holds a ill-defined impersonal third party responsible (the evil “supermarket duopoly”) and (d) it encourages the state to solve the problem (just you wait for the ComCom report *finger wag*!

    Whether or not the price of fruit and veg is high is beside the point. Labouristas believe that food prices are responsible for the world not being the way they would like it to be. It also shows characteristics of the messianic cult that is the Labour party (Ive seen it, I used to be a member). You can argue with them, dispute their statistics, or suggest alternatives (if supermarkets are so expensive, why not just shop at the market?? Crazy!) but it won’t make them change their minds.

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  13. mikenmild (11,246 comments) says:

    PTM
    Growing your own veges is a good option. Typically ignored by the poorly educated. I wonder if there’d be room in the school curriculum for more of these basic life skills?

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  14. dime (9,798 comments) says:

    Huevon – wish i could give multiple upticks for that. well said.

    Also, supermarkets dont may their “workers” enough. They should be paying the living wage! and making things cheaper for “families”.

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  15. Kimble (4,443 comments) says:

    Does the market sell toilet paper? Does it sell ice-cream? Does it sell dog food?

    Prices in supermarkets and single-good stalls are not comparable in the least.

    If the difference is so great, why aren’t people buying vege’s from the market instead? That would be a much more productive use of analysts time. You know, if you actually gave a shit about the truth rather than politicking.

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  16. david (2,571 comments) says:

    Highly scientific and defensible ….. NOT It is a nice fudge with “fruit and vege markets” not being defined and later morphing into “farmers’ markets”, an altogether different animal indeed. This report or study or whatever it purports to be is a disgrace to the researcher and to the researcher’s employer. If that is the standard of Otago University I hope a bunch more doctors get enticed to go to Australia.

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  17. OTGO (537 comments) says:

    Who cares about fruit and veges? I’m more worried about the increase in bacon prices. Bacon mmmm it’s still my favourite vegetable.

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  18. burt (8,189 comments) says:

    It’s so unfair that people are forced to go to supermarkets and not allowed to go to farmers markets !

    We need Nanny to make supermarkets sell veges for the same price as farmers markets !!!!!

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  19. Minnie (98 comments) says:

    I am surprised that Ms Beaumont didn’t also threaten to get the wicked duopoly leaders into her office and demand they explain themselves. It’s what Mr Cunliffe has recently taken to doing.

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  20. journo (11 comments) says:

    I used to shop some Sunday mornings at the market alongside the Panmure community centre (and Mt Wellington Library), a venture which I understand is run by the Labour Party as a fundraiser. This is Beaumont territory, where the list MP tries assiduously to present herself as the local representative.

    It was a cheerful enough place and good for cheap books and the like, as well as vegetables, fish, etc. I stopped shopping there, though, because the fruit and vege prices were mostly higher than Pak ‘n’ Save in Glen Innes, or at best much the same and the supermarket was closer to my home in the eastern bays.

    Prices are slightly better at the Sunday market in Stonefields and produce is usually fresher, possibly because of the higher turnover.

    Perhaps Ms Beaumont should do some research in her back yard?

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  21. thor42 (971 comments) says:

    “And how much did fruit and vege prices rise from February 2006 to February 2009. A whopping 29.6% or 9.9% a year!!!”

    Exactly.

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  22. Cunningham (836 comments) says:

    So why can’t people just shop at the markets? I can’t remember seeing anyone walking around the supermarket with a gun to their head. Oh that’s right, people shouldn’t have a choice according to the left. We are much to dumb to make our own choices. The government knows best. Wankers.

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  23. DonC (9 comments) says:

    I’m not sure either of the differences between farmers’ markets and ordinary markets. If farmers supply these markets, then that makes sense – they are cutting out the middleman. But the markets that are not farmers’ ones, then presumably there are middleman – and the lower prices – if they exist – are from cutting corners.

    The biggest cost cut is to sell second grade fruit and vegetables that the supermarkets would reject. I guess to some people it looks authentic.

    Market food might be organic – but there can be too much of a good thing – dog poo, windblown dust ‘n dirt, general crap, all the sorts of things that happen in the outdoors and on the ground.

    With supermarket food there are quality control systems and it’s not out there in the full heat of mid summer wilting. But again, some people think this makes it authentic.

    Grow your own – and take your chances with the pesticide doses – or feed the caterpillars.

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  24. igm (1,413 comments) says:

    I find the whinging of lazy Labourites unbelievable. I was in Naenae once, and surprised to see people coming out of their local supermarket with bundles of silverbeet, this being on special. I actually was dealing with a purchaser on a matter, and asked whether he lived in a local State house, he did, equipped with a quarter acre fertile section, unmown lawns, no garden, he a beneficiary, who said he would not work for less than $20 an hour, and having no qualifications in any field. His problem drew out and when I visited him once again, there was a vote Labour sign prominent on the road frontage, and he was sitting inside watching Sky on a flat screen, these being in their infancy . . . Labour are supported by bludgers, losers and leeches.

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  25. NoCash (257 comments) says:

    Fear not, Labour’s new KiwiMart is coming to the rescue.

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  26. Rex Widerstrom (5,345 comments) says:

    I can see some people spending $100 on fruit & veges a week. In Wainuiomata there’s now only Countdown, which knows it has a catchment of elderly people such as my parents who don’t get over the hill to the much cheaper prices at Pak n Save. Having shopped locally for them over the past few weeks, I’d estimate the three of us would be spending over $50. The fuel to Petone & back just for groceries probably knocks out most of the saving.

    Growing vegetables is great – I do it whenever I can, but I’m generally confined to planter boxes on a balcony. What NZ needs is allotments, or perhaps community gardens, though I’d prefer the former. I’ve suggested this to many politicians but no one seemed to think Kiwis would take it up.

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  27. Bob R (1,358 comments) says:

    I thought I might be reading The Onion?!

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  28. Red (9 comments) says:

    She’s obviously not seen the prices at some Farmers Markets, if she believes they are a better deal.
    Her comments also highlight the fact that the usual suspects from the left, who’d like to be in charge of everything – have led such sheltered lives in the towers of academia, NGO’s and consultancy, that they have zero comprehension of how business, large or small, actually works.
    In my experience supermarkets are cheaper & you’re not left wondering what special “ingredients” Mr Watsit at the markets uses to grow his Tomatoes so large…..

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  29. NK (1,218 comments) says:

    I have the answer: Kiwifruitandveges!

    We already have Kiwifruit. We now need Kiwiveges.

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  30. weizguy (120 comments) says:

    Has your reader not heard of economies of scale? Does your reader really think that the difference in price is because of: “advertising, power, wages for 1000′s of staff, time and a half, days in lieu, sick leave, stat days, holiday pay, …” ???

    The stupid does hurt, but not where your reader thinks it does. We could start with the comment section of this post.

    Any attempt to respond to the substance of the criticism? That supermarkets might actually be taking advantage of their duopoly status?

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  31. NK (1,218 comments) says:

    Well in Auckland, the supermarkets hardly have a duopoly on fruit and vegetables. There’s a plethora of small fruit and vege shops near where I live. And they are a lot cheaper than supermarkets, and of course have much fewer staff and naturally lower overheads.

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  32. Peter (1,688 comments) says:

    If the difference was that great, people would likely go to markets. The fact they go to supermarkets suggests that difference isn’t so great and/or they get value from supermarkets they don’t get from markets i.e convenience.

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  33. Sir Cullen's Sidekick (869 comments) says:

    Wait until Labour and Greens announce a “Super Market Veg and Fruit tax”……

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  34. Rich Prick (1,659 comments) says:

    Farmers’ Markets don’t have the up-turned banana code. I’d be lost without it.

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  35. mandk (949 comments) says:

    “An Otago University report shows Kiwi households are likely to be spending upwards of $2500 a year more on their fruit and veges if they buy them from a supermarket rather than their local market”

    This is such nonsense. The Household Economic Survey for the year ending June 2013, shows that average household expenditure on fruit and veg was $20.10 per week. Average weekly expenditure on all types of food was $192.50.

    By way of comparison, the average household expenditure on alcohol and tobacco was $29.90 per week!

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  36. nasska (11,097 comments) says:

    mandk

    You would tend to presume that the wankers who populate our institutions of higher learning might check with such surveys if only to ensure that they don’t make absolute fools of themselves every time.

    Fat hope.

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  37. rangitoto (239 comments) says:

    I find that on the Shore a number of Green Grocers are cheaper than the supermarkets apart from specials that crop up from time to time. If the supermarkets are too expensive there’s nothing to stop people buying elsewhere.

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  38. adamsmith1922 (890 comments) says:

    mikenmild

    You mentioned the Riverbank Market in Lower Hutt on Saturday mornings which I go to regularly. You can but fish there, bread, some meats as well as fruit and vege. It does pay to comparison shop between stalls. It is not always cheaper for everything. For instance the other Saturday I overheard one shopper telling a stallkeeper she could get an item, cannot remember now what it was cheaper at Pak n Save. His response was if so go to Pak n Save as overall his pricing was better.

    mandk I think you are right, there is a major disconnect with amounts quoted.

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  39. mandk (949 comments) says:

    @ nasska

    Agreed. Surely the first rule for any researcher should be: Ask yourself if the number feels right.

    It took me about 2 minutes to establish that they were talking bollocks.

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  40. Richard Hurst (829 comments) says:

    As I’ve said before on this blog, people in this country seem to think that supermarkets making a profit is somehow wrong. They are just like any other business – they must make a profit or they will go out of business and how much profit is determined by the customer and the market. Everything is worth what the purchaser is prepared to pay for it. What’s next? Govt price setting of all fruit and veg??

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  41. greenjacket (451 comments) says:

    The local Farmer’s market is generally a little cheaper (not much and certainly not by $2500 a year!) but the fruit is also a lot older and more bruised. You pay for what you get.

    I knew that Carol Beaumont had a reputation for being loyal but dim, but this is laughably stupid. Surely all press releases from Labour MPs are checked by the Leader’s office first? In which case, how on earth did this laughable press release get through the Leader’s office? Another sign of the problems in Labour.

    And this is the second thing today on Kiwiblog in which Otago University academics show themselves up as total and utter idiots. It really makes me question the calibre of graduates from Otago if their lecturers are such morons.

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  42. OneTrack (2,970 comments) says:

    “What’s next? Govt price setting of all fruit and veg??”

    Obviously, if Carol Beaumont gets in, the answer is “Yes”.

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  43. artemisia (235 comments) says:

    I wonder whether markets and greengrocer shops pay taxes on every single cash transaction. Greengrocers are known (anecdotally, from people I know who have owned or worked in them) to not put all purchases through the till. Doubt that supermarkets would be able to evade tax.

    Course, if you are not paying income tax and GST you can sell stuff more cheaply.

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  44. wiseowl (859 comments) says:

    @richardhurst.
    WE used to have an auction system for fruit and veg.This was the fairest.A true free market and prices determined by supply and demand.

    When it was done away with the supermarkets and T&G took over.They control everything and you became big or were killed off.
    Many people here do not know what they are talking about but I can asure you the supermarkets make huge markups on fruit and veg.
    One has to find other ways to market produce these days.

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  45. slijmbal (1,229 comments) says:

    Having worked for the head office of a supermarket and being the grocery shopper of the family on the Shore where we have more vegie shops than supermarkets and have occasionally drove out to Kumeu for the vegie stores close to the farms out there my conclusions are:

    1) Supermarkets have a very large mark up on fruit & veg but they also only take the ‘picture perfect’ produce with minimal marks, scuffs, mangy bits etc and they also have a very large rate of spoilage as they throw away lots of perfectly good produce that age enough to look a bit crappy and nobody will buy it.

    2) The North Shore produce shops can be lots cheaper than the supermarkets but normally they are somewhat cheaper and the quality is a bit less but perfectly acceptable and often the volume produce is actually cheaper in the Supermarket.

    3) Produce out west in Kumeu is about 25% cheaper but the additional time to get the stuff isn’t worth the savings

    Conclusion – if I have time I visit both the local produce shop and the supermarket and buy my produce from both based on price and quality – if pushed for time I just use the supermarket.

    Organic produce costs a bloody fortune and surprisingly rarely tastes better.

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  46. Richard Hurst (829 comments) says:

    wiseow:

    Sigh. Sign again. Of course supermarkets put mark ups on fruit and veg!!! How do you think they make profits when grocery items are often sold as loss leaders to get people in the store?? And if the mark up is too high people won’t buy the stuff or if their too lazy to look elsewhere they will. If you do not like this then: THEN DO NOT SHOP IN THEM! Go to somewhere else there are plenty of choices. If you prefer state control pls try North Korea. I hear fruit and veg are state controlled items there.

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  47. godruelf (55 comments) says:

    Im pretty sure that most of the markets are following the previous Labour policy of No GST on Fruit and Veges.

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  48. Johnboy (15,903 comments) says:

    I never eat vegetables. Only good wholesome meat. Preferably nice fresh lamb. :)

    Can’t understand what all the bother is about really? :)

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  49. Johnboy (15,903 comments) says:

    Fuck slijmbal. That’s a bloody long winded way to admit to us all that you’re really an Albany trolley boy! :)

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  50. Ben Dover (526 comments) says:

    I am blessed by having an ALTERNATIVE to
    THE STUPID Market

    I buy my food in one of three long standing food market run by “food nuts”

    I enjoy my shopping I have so much choice

    It is “Fun”

    I can get snapper for 12 dolla a kio
    some other fish 7 dolla a kilo

    green lip mussels 5 dolla

    Good Rump steak 8 dolla a kilo

    I get the best out of 40 fruiterers butchers or fish mongers etc etc etc
    along with some food specialist

    SUPER MARKET FOOD is SH*T

    ABSOLUTE C R A P

    THEY ARE RUN BY SCUM to SERVICE IDIOTS

    Grow your own or go to the markets

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  51. seanmaitland (488 comments) says:

    @Rex Widerstrom – I used a few feet of planter boxes last summer and grew 30 KG of tomatoes, with basil/thyme/mint growing in between all the tomato plants, and had an indoor enlongated bucket that was full of regenerating rocket leaves all summer. All up, the organics (soil/plant food/seedlings) cost me about $20. The only thing that was to my advantage was that I’m based in Auckland where theres never any frost and the summer lasts for 6 months, so you get 2-3 harvesting cycles once you get the knack of it.

    Given that the majority of state houses have some garden, its not a viable excuse for poor people to be making. They should be getting dozens of kilos of produce from small strips of garden.

    If anyone had ever travelled to places like Italy they would see this done to the nth degree, feeding entire families throughout Umbria and Tuscany.

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  52. prosper (146 comments) says:

    Supermarkets in NZ are very expensive compared to Australia, France, Italy, Spain, Holland and USA. Why because we have a duopoly and an extremely ineffective commerce commission. Suppliers are charged for shelf space, advertising, specials and that’s before you get to very large margins. In some malls they don’t pay rent. We need the Aldi chain in NZ to provide serious competition and an effective commerce commission.

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  53. Chris R (69 comments) says:

    prosper: Your statement that NZ supermarkets being dearer than those in Australia requires explanation. I surmise that your statement is anecdotal only. If I were to do likewise I think I would surmise the opposite, but to do so is as pointless as your suggestion.

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  54. wat dabney (3,755 comments) says:

    A similar study would also conclude it is cheaper to buy your cigarettes from smugglers.

    And if you want tripe, got to Otago University.

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  55. prosper (146 comments) says:

    Chris . My statement is not scientific it based on my own shopping experience in Brisbane, The Hague, Nice, Malaga, Lecce and Washington DC. We usually rent an apartment and stay for several weeks or stay with relatives. We do a weekly shop and in the basket include quite a bit cheese then the usual pasta, verges, bread, milk wine etc. In some countries NZ cheese and wine is much cheaper than home.

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  56. burt (8,189 comments) says:

    Ben Dover

    Exactly, OMG the convenience of the supermarket comes with a cost – who’d have thunk it !

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