Pak 'n Save Supermarkets are operated by Foodstuffs New Zealand Ltd. Foodstuffs also operates the supermarket brands 4Square and New World. Foodstuffs is a co-operative business which means that each store is owned by individual owners but they use their collective buying power of hundreds of stores to purchase from suppliers at a better price.
This is as opposed to Progressive Enterprises who run Foodtown, Countdown. All stores are owned by one large company, not individual stores owned by private individuals. So is there any advantage to shopping at a collective business? Collective style businesses are better for the economy. This is because each store is owned locally so the profits generally will stay within the country and usually within the local community.
The other benefit of a collective is that smaller independent stores in rural and far out areas still get the benefit of the lower group prices as they are part of the collective. they are not disadvantaged by location. Otherwise if they were independent they would have to negotiate directly with suppliers and because they would only buy a small quantity they would not get good prices over a large big volume negotiator. So the collective bargaining under Foodstuffs umbrella means that they pay the same as the larger stores. This is better for the smaller local communities as the stores don't have to change high prices due to location.
Progressive Enterprises is owned by an Australian publicly-listed retail giant so the profits go offshore which harms the NZ economy. Pak 'n Save is cheaper than most other supermarkets so it seems the collective system works well. Both for the independent stores, the local communities, and of course for the consumer.
Auckland, New Zealand
Monday, January 21, 2008
Subscribe to:
Posts (Atom)