Consumers warned about product price increases in alert level 1 compared to start of year

Sport Planning Editor·NZ Herald·

6 Jul, 2020 11:50 PM3 mins to read

Kiwis could be paying more for products at alert level 1 than they were earlier in 2020. Photo / 123RF

You could be paying more than three times the amount for products today than you were in January, PriceSpy data reveals.

Paymark figures also show the average spend at core retail shops, primarily those in retail, for June was $51 per transaction compared to $47 on average last June.

Covid-19 has affected global supply chains, manufacturing times, workforce distribution and there is a heightened demand for products by consumers.

Looking across the entire price index of price comparison site PriceSpy, there has been a sharp increase in price for products since the lockdown ended.

For example, webcams, televisions, and washing machines all appear to be more expensive now compared to a couple of months ago.

However, not all products have increased in price since the pandemic lockdown ended in New Zealand with the cost of mobile phones decreasing.

PriceSpy New Zealand country manager Liisa Matinvesi-Bassett says their data highlights how much of an impact Covid-19 has had on product prices.

"For example, from January through to mid-March, the indexed price change ranged between -0.5 per cent and +2 per cent," she said.

"From late-March through to mid-June when Covid-19 was more rife and the borders were closed, the indexed price changes increased sharply and quickly, varying between 3.75 per cent and almost 6 per cent - at least three times higher compared to earlier in the year."

PriceSpy's price index is a daily updated chain index that tracks price changes over time.

Spending rebounded strongly in June against many Paymark merchants, however, the situation remains mixed with hospitality suffering.

Hospitality merchants recorded a -6.1 per cent annual change for June - significantly better than the -47.9 per cent average over the June quarter.

Elsewhere, core retail merchants are experiencing higher-than-trend growth rates with a 11.6 per cent increase last month.

An underlying group of core retail merchants also experienced 7.1 per cent higher payments through June this year, relative to the same time in 2019, Paymark said.

It brought the quarterly annual rate of change for the group to -15.5 per cent, compared with annual growth rates of 3.6 per cent in the March quarter and 4.8 per cent in the June quarter last year.

Meanwhile, the year-on-year number of people searching for products on PriceSpy increased by almost a third in May 2020.

The 31 per cent increase indicates shoppers are increasingly looking to price compare due to the coronavirus pandemic, Matinvesi-Bassett said.

"It seems price is certainly going to be a really important factor for consumers who are looking to make a purchase over the next few months," she said.

"Using a price comparison site regularly will help provide shoppers access to a wide range of prices for products that are updated in real-time across many stores, so they can always find the cheapest price possible if they need to buy something urgently."

PriceSpy has 108,000 products listed on its website and more than 1.7 million indexed prices.