Oily Rag - The Milk Report

 Read more Oily Rag articles by Frank and Muriel Newman 
 
Milk is a household essential, especially for families with young mouths to feed. So the Oily Rag Research Department wanted to know how much people are paying for milk, and come up with ways to make savings. This column outlines results of our survey.
 
The survey was conducted via www.oilyrag.co.nz. More than 600 responses came in from all across the country (even Australia!).  To keep things simple we compared the cost of a two-litre bottle of standard blue stop non-organic milk. This is what we found:

• There is a significant difference in the retail price. One person said they pay $3.25 for milk at their supermarket which sells for $4.60 at their local dairy.

• The same milk is bottled under different brands and sold at different prices.

• The retail price of milk processed by small independent producers is significantly cheaper than their much larger competitors.

• The lowest price for a standard 2-litre bottle was $2.40 for Dairy Dale brand at a speciality food outlet in Manukau. The highest price was $5.20 for Anchor brand from a dairy in Wellington.

• The retail market for milk is made up of various brands. At the “premium price” end is Anchor and Meadow Fresh, produced by Fonterra and NZ Dairy Foods respectively. At the mid-price range are supermarket house brands, and at the lowest price point are the discount brands of Dairy Dale and Dairy Fresh (also produced by Fonterra and NZ Dairy Foods respectively). These discount brands compete directly with the independent producer brands that are all priced significantly below the other brands.

• The retail price of all four independent milk processors was the lowest, averaging $2.80. The two discount brands, Dairy Dale and Dairy Fresh, averaged $2.92, while supermarket house brands (Signature, Home Brand, Pams and Budget) averaged $3.21. The two premium brands (Anchor and Meadow Fresh) were significantly higher at an average $4.48.

• The cheapest place to buy milk is at speciality food outlets (eg ethnic food outlets and butchers) and fruit and vegetable retailers, with an average price of $2.84. Many of these outlets also offered a discount for two-bottles, typically 2 for $5, which reduced the average price further.

• Dairies and petrol stations are, in general, the most expensive places to buy milk, with average retail prices of $3.40 and $3.46 respectively, although a number do retail the discount brands at under $3 or offer buy-two specials.

• Supermarkets had an average retail price of $3.25.

 Here’s how you can save money when buying milk:

 
1. Be more aware of price. There is a significant variation in price for what is essentially the same milk. If you are paying more than $3.50 for a 2-litre bottle of standard milk you are paying too much.

2. Buy one of the independent brands (Klondyke, Fresha Valley, Green Valley and Al & Son) or a discount brand (Dairy Dale or Dairy Fresh). If these are not available purchase a supermarket house brand (like Signature, Home Brand, Pams and Budget).

3. Look for the buy two specials, particularly 2 for $5 deals offered by fruit retailers and speciality foods places. It would appear as though these outlets are discounting the retail price of milk to attract customers to their outlets.
 
Many thanks to those who took part in our milk price survey. A full copy of the Milk report will be posted on www.oilyrag.co.nz.

* Frank and Muriel Newman are the authors of Living off the Smell of an Oily Rag in NZ. Readers can submit their oily rag tips on-line at www.oilyrag.co.nz. The book is available from bookstores and online at www.oilyrag.co.nz.

Published 25th May 2009

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