Chris Quin: Foodstuff's North Island CEO on Commerce Commission's pending decision on merger of operations

The Commerce Commission is pushing out its timeline for approving the Foodstuffs merger, due to "unresolved issues". 

It now expects to reach a decision in October. 

The North and South Island co-operatives - which run the Pak'nSave, New World and Four Square supermarkets - sought clearance to merge last year. 

Foodstuff's North Island Chief Executive Chris Quin told Heather du Plessis-Allan “We knew this could happen, but we remain committed that this is the right thing to do.” 

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Episode Transcript

Speaker 1 (00:00):
The Commerce Commission has delayed its decision on whether to
allow food Stuffs to merge its North and South Island operations. Again.
It was due to make a decision today, but now
it says it's extended its deadline to October. It's set
to outline problem areas with the mergers soon and then
food Stuffs and other interested parties will be able to
respond after that. Food Stuff's North Island's chief executive, Chris
Quinn is with me.

Speaker 2 (00:20):
Now, Hey, Chris, evening, Heather, how are you arm well?
Thank you?

Speaker 1 (00:23):
Were you expecting this many delays?

Speaker 2 (00:27):
Look, when we started the process, we knew there could
be three stages, and this is the third stage, which
is a statement of unresolved issues. We expect to see
in about three and a half weeks or so. So
we knew this could happen, But we do remain one
hundred percent committed to this being absolutely the right thing
to do.

Speaker 1 (00:44):
Have they communicated to you what the unresolved issues are?

Speaker 2 (00:47):
No, not at this point. We believe we get that
sometime in the middle of July.

Speaker 1 (00:52):
Are you starting to lose hope? I mean, this is
obviously a really gnarly one for them.

Speaker 2 (00:57):
Look, we get that this has got huge exposure. There's
been a lot of conversation about this, and we understand
that with cost of living and all of the things
that affect New Zealand households, what we are really pleased
with is the last three months food price inflation has
been well below a percent. We think we've tackled the
issues that came because of weather and became because of
the global supply chain and the various cost issues from

(01:21):
our suppliers. So we're determined because the next thing we
can do for our customers to improve value and to
improve innovation and comparediveness for a New Zealand owned cooperative
is to make this merger happen and make us more
efficient and reduce our costs.

Speaker 1 (01:36):
Do you think the suppliers have the ear of the
Communis Commission because your supplies are very worried about the Sunday.

Speaker 2 (01:43):
Look. I talked to a lot of suppliers and I
don't find many that are very worried about this. I
see that there are anonymous reports in the media and
various stories. I talked to a lot of suppliers. We
literally every couple of weeks here from hundreds of them.
We're not hearing some of the same issues. We know
that this merger makes it easier for supplies to engage

(02:05):
with us to get to all of the customers nationally.
We will still be able to do a supplier working
with one local store owned by a local family that
will not go away at any point, and we think
that there's real opportunity for suppliers on this.

Speaker 1 (02:18):
So what the supplier has suggested that they are really
worried about, and this is a particular one that is
anonymous talking to the media today, is that they are
worried that they will just be cut out of being
able to supply if there is just one big decider
right at the moment. Obviously they can go to your competitor,
or they could go to yourself, or they can go
to food Stuff South Island. But if it's just if
you guys amalgamate, it's just two options for them, and

(02:40):
that's a big gamble. Is that potentially a problem where
if they fall out of favor, they're out Well.

Speaker 2 (02:45):
I think the first thing is, if we think logically
about it, to get to North Island customers, there are
two large retailer grocery options, and to get the South
Old customers there are too, and we still will be
after this merger. It makes no change to that. The
other thing that's quite unique about Foodstuffs is with every
one of our stores having one individual local growth runing family,

(03:05):
the supply can work with them to get locally ranged.
There are some amazing products on shelf in our stores
that are very local and very loved in that community.
And we have an emerged program where we've worked with
over turn and fifty supplies in the North Island. About
fifty of them, you know, brand new startup supplies. People
have great ideas. About fifty of them are now on
shelf in a small number of stores or a large number,

(03:28):
depending on who they are. That sort of thing we've
been so proud of for the last hundred years to do,
and we're going to keep doing after this merger.

Speaker 1 (03:35):
Hey, Chris, while I've got you on the land covenance case,
am I right in reading this the way that it
looks like it's played out, which is that the ComCom
takes takes it to court, files against you guys, and
then you settle after that.

Speaker 2 (03:48):
Essentially we have started the process of a settlement on
that issue. Relating back to twenty thirteen, fourteen, and the
court will review that settlement and decided they're satisfied with
it and for how much. I can't say at this point.

Speaker 1 (04:02):
Will that be made public once the court says yes
or no, I believe it. Well, okay, cool, Hey, thank you, Chris.
Enjoy your week and really appreciate your time. That's Chris Quinn,
chief executive of food Stuff's North Island.

Speaker 2 (04:12):
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