By Michael Morrah
A specialist grocery store has dropped the price of its milk to $1 per litre in the hope it will encourage other chains to do the same.
But the big supermarkets say the deal is just a gimmick to try and get more customers, and such discounting isn’t sustainable.
Nosh supermarkets became a hotspot for bargain hunters as stores opened for business today – and it was the price of milk bringing customers through the doors.
“For the month of February from today onwards, we’ll be dropping our price on Cow and Gate milk to $2 for two litres, so in essence, that’s $1 a litre,” says Nosh chief executive Clinton Beuvink.
That’s less than half the normal price and is part of a campaign aimed at pushing other retailers into making similar cuts.
“Milk is a unique produce line,” says Mr Beuvink. “Making excessive margins on milk is just not right and a kick in the guts for New Zealand consumers.”
That’s a direct dig at the big supermarket chains, who Mr Beuvink says add too much to the wholesale price.
It was $3 for two litres at New World in Karori – but only when you spend $25 or more.
Foodstuffs, who own the chains Pak N Save and New World, are calling the move by Nosh a “gimmick” and say having lower price milk will mean the grocer will have to increase prices on products like meat and vegetables.
But Consumer NZ says the big supermarkets are being hypocritical.
“I think it’s a bit rich for a supermarket chain to say that, as that’s how they operate on a daily basis by having some loss leaders,” says Consumer NZ chief executive Sue Chetwin.
“If Nosh has chosen milk as their loss leader, then good on them.”
Nosh has based its campaign on a similar one in Australia, where supermarket chain Coles dropped its price to $1 a litre. Other competitors followed.
That hasn’t happened here yet, but might if more consumers change where they spend their money.
Nosh says it will continue to offer cheap prices for the rest of the month.
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