Wow.  

That’s a fair reaction to the news that there is a possibility the supermarket chains could be broken up.  

This is coming out of the Commerce Commission inquiry into the supermarket businesses.  

Apparently the ComCom has been asking the supermarkets very detailed questions around forcing them to sell-off stores and splitting up the businesses.  

The big headline - there is the possibility of forced store sales.  Obviously, the point of doing that would be to sell them to a new or smaller, existing supermarket chain to get a third big competitor up and running.  

Would the ComCom actually do it?  

Probably not.  

It feels like it’s too big a risk for New Zealand’s reputation as a safe place to invest.  We have had so many investment shocks in the last four years of the Labour Government, from the oil and gas ban to the completely unreasonable and ineffectual crack down on landlords earlier this year.   
This will probably do too much damage to investor trust in us.  

Plus, many of those stores are family owned.  So, how do you pick which unlucky family is forced to sell their store, and which lucky family gets to keep theirs?  

It seems fraught. 

But I reckon this still sends a signal that something big could be coming . 

Clearly the ComCom is prepared to go really hard on the supermarkets so, maybe, they might do something like force the supermarket chains to open up the wholesale market; which means the big boys would be forced to sell produce and what not to the little guys and the new guys consistently and at decent prices. 

And they can’t just cut them off on a whim.  

That does happen by the way.  

At the start of this outbreak, Countdown cut back the supplies it was selling Night and Day stores in the North Island, saying it needed the supplies itself. 

Now that might be fair – who knows – but for night and day that’s no way to run a business. 

That kind of thing puts the smaller guys at constant risk.   

It’s good news that the Commerce Commission seems to be taking this market study seriously after the flop of the petrol market study.  

Most of us would agree there’s something very wrong with the price of groceries in this country and it’s probably going to take something big to fix that.  

And from the sounds of things - big is very much a possibility.