Foodco merger scrutiny urged
2 worries over impact

QUESTIONS are being raised about the Foodland-Meatco merger and the impact it will have on local grocery and food shopping.
Foodland and Meatco said on Friday in a joint news release that they will become one organisation.
This is expected to be called Foodco and designed to modernise and steamline the bulk of the Cook Islands grocery and wholesale food business, they said.
Those familiar with the local retail market say the growth of Jimco’s Manea Foods has affected both Meatco and Foodland. This is through the growing range of products Manea Foods is offering – including meat – and its low prices.
But a leading Rarotonga businessman, speaking on condition he is not identified because of his position, said Foodland-Meatco’s merger could have two impacts which should be scrutinised.
One could be to significantly lessen competition, with the merger cutting the number of major supermarkets on Rarotonga by a quarter.
It could also give the new merged company, which is expected to be called Foodco, a lot of more power controlling the local market, he said.
The businessman said there are indications that with this merger, and possible developments by local trading powerhouse CITC, the control of the shopping market will be in fewer hands.
BUNNINGS
The businessman said: “I understand that there is a possible franchising of Bunnings by CITC. All of which can and will impact severely on smaller business and the public.”
The Bunnings warehouse group is the leading seller of home and garden improvement products in Australia and New Zealand and a major supplier of building materials. Cook Islands businesses can now ship in products direct from Bunnings and sell locally, the businessman said. But if CITC gets the local franchise they would not be able to do this.
He said the Government and Chamber of Commerce should both state their positions on the Foodland-Meatco merger.
In New Zealand such a merger would be scrutinised under the Commerce Act, he said.
Family
Foodland principal John Wichman said: “We think it’s great that we’ve been able to put our two businesses together. We are close family and we’ve talked about this for a long time.”
Brett Porter, of Meatco, said: “We can work together as a team and our teams can work together. We know we have to be more productive at all levels of our business.”
The directors described plans for the development of a downtown Avarua modern supermarket complex.
Porter said: “We will create a whole new experience in food shopping, at the most competitive price levels.”

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