Latest / Best of Business / Patrick Noone: former Costco NZ managing director on whether more grocery retailers would boost competition

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Patrick Noone: former Costco NZ managing director on whether more grocery retailers would boost competition · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks be follow
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  Speaker 1: this and our Wide Ranger podcasts now on iHeartRadio.
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  Speaker 2: Ever do for Sea Ellen, But.
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  Speaker 3: Thankfulyar when Nichola Willis's supermarket shake up will make a
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  Speaker 3: difference in your weekly shop. Yesterday, of course she announced
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  Speaker 3: a raff of reforms to make it easy for new
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  Speaker 3: supermarket players to open and expand across the country and
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  Speaker 3: it was clearly aimed at Costco. Patrick Noon is the
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  Speaker 3: former managing director of Costco New Zealand.
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  Speaker 2: Hi Patrick, Hi, how are you very well?
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  Speaker 3: Thank you?
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  Speaker 2: Now?
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  Speaker 3: Costco was already planning expansion outside of Auckland. So has
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  Speaker 3: this actually changed anything?
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  Speaker 2: You know? I'm not aware of the costco current plans
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  Speaker 2: have been retired for two years now, but I can
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  Speaker 2: comment on before I did retire, Costco was really interested
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  Speaker 2: in New Zealand market. It's a great market. There is
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  Speaker 2: a lack of competition there and Costco can bring quids
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  Speaker 2: and services to the market, add some really really good
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  Speaker 2: savings to our members there. And a case in point,
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  Speaker 2: you know the West Auckland store in that same precinct
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  Speaker 2: we had pack and say we had war wors across
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  Speaker 2: the street and were able to operate and be extremely
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  Speaker 2: competitive to the local market. So yes, New Zealand market
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  Speaker 2: is a very attractive proposition for any food retailer. I
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  Speaker 2: would think around the world, why hasn't Costco.
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  Speaker 3: If Costco loves it so much, why haven't they actually
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  Speaker 3: expanded thus far? Because they had the Wellington plans and
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  Speaker 3: they had what appears to have been the Rolliston plans
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  Speaker 3: and nothing's actually opened.
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  Speaker 2: Well again, I'll just couch it and saying I'm not
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  Speaker 2: aware of the current plans. They'll being sort of out
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  Speaker 2: of touch with the group there. But at the time,
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  Speaker 2: you think a new country is a very expensive proposition.
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  Speaker 2: It takes a lot of infrastructure in terms of the
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  Speaker 2: buying side of it. In terms of at that time,
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  Speaker 2: the cost of building in Auckland was very expensive. The
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  Speaker 2: cost of dealing with the Auckland Council added layers of
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  Speaker 2: cost to the whole project. So it's a very expensive cost.
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  Speaker 2: So you have to have a return on your investment.
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  Speaker 2: So one class go at that time was sort of
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  Speaker 2: a test to see how it all worked out. The
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  Speaker 2: last thing. The other thing about New Zealand is zero
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  Speaker 2: an island or two islands and getting inventory from North America,
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  Speaker 2: from Asia and from the Australian market. Took a lot
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  Speaker 2: of coordination, so that also presents some issues as well
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  Speaker 2: being in stock all the time.
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  Speaker 3: Do you think that it's the game change of Costco?
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  Speaker 3: Is the game changer that the country is looking for?
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  Speaker 2: Oh? I think so. I think Costco just from the
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  Speaker 2: merchandising perspective and now that they're working out their kinks
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  Speaker 2: we had initially. I think Costco can bring a lot
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  Speaker 2: of value to the market for the New Zealand consumers. Absolutely,
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  Speaker 2: we're proving that already and in fact that hasn't changed
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  Speaker 2: since day we open.
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  Speaker 3: Patrick. Thank you for your time, Patrick Noon, former Costco
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  Speaker 3: Managing Director of New Zealand.
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