Saturday, September 18, 2021

Money & Shopping in New Zealand

Australia and OceaniaNew ZealandMoney & Shopping in New Zealand

The currency in New Zealand

The currency in New Zealand is the New Zealand Dollar (NZD, $), divided into 100 cents. It is freely floating and exchange rates can change dramatically in just one week. As of October 2015, one US dollar is exchanged for about 1.50 New Zealand dollars. Australian dollar coins are sometimes accepted in place of New Zealand dollars. Other foreign currencies are not readily accepted, except in some major hotels and banks throughout New Zealand.

Coins are available in 10¢ (copper), 20¢, 50¢ (silver), $1 and $2 (gold). When you pay cash, the total price is rounded up to the nearest 10¢ (5¢ can be rounded back and forth, but most companies round down). Especially in restaurants, it is not uncommon for prices that end in multiples of 10 cents to drop the last zero, e.g. $9.4 instead of $9.40.

Tickets are available in $5 (orange), $10 (blue), $20 (green), $50 (purple) and $100 (red). There are two series of tickets in circulation, the sixth (1999) and the seventh (2015). The two series are essentially similar, with a notable New Zealander (except on the $20 note, which features Queen Elizabeth II) on the obverse and a native New Zealand bird on the reverse. All the notes are printed on polymer so they won’t be mishandled if you leave them in the wash.

New Zealanders are among the largest users of electronic banking in the world. Almost all shops are equipped with payment terminals for debit and credit cards, so most purchases can be made electronically. International credit and debit cards are not accepted by some merchants with Eftpos terminals, especially small food retailers such as dairies, takeaways and non-alcoholic cafes. Small retailers can often set a minimum purchase amount of around $10 if they agree to spend cash. Many New Zealanders do not carry large amounts of cash as they see this as a risk and inconvenience compared to using their Eftpos card. However, it is always a good idea to carry cash for emergencies as electronic payment systems can fail and many retailers are reluctant to use their emergency ‘Zip-Zap’ printers. All New Zealand banks offer telephone and internet banking. If you plan to stay in New Zealand for a while, it may be wise to open a New Zealand bank account and set up a local debit card. Paying by cheque is becoming increasingly rare in New Zealand and most shops do not accept it. Most businesses and individuals now include their 15-digit account number (e.g. 12-3456-0789123-00) on their bills, and customers transfer money to their account via internet banking. This practice is common when buying a car or pre-booking a flat; payment is usually made the next working day.

All New Zealand banks allow visitors and migrants to open an account through their respective websites less than six months before arrival. It takes about two weeks for your Eftpos card to arrive. The bank will be happy to send it to the branch of your choice. In New Zealand, the ‘Big Four’ banks are ANZ, ASB, BNZ and Westpac; the other major banks are Kiwibank and TSB.

Automated teller machines (ATMs), popularly known as “holes in the wall” or “cash dispensers”, can be found in almost every town, even those without a bank. Be careful who you use, however, as most banks will charge you a fee to use a competing machine, usually $1. If you withdraw money from ANZ with a foreign card, you will be charged $3 to use the ATM. BNZ and Kiwibank do not charge for cards from overseas.

New Zealand uses the almost universal (except in the US) chip and PIN system, which uses a microchip in the card and the cardholder’s personal identification number to verify the transaction. Most merchants also accept the swipe and sign method; if you use a card without an embedded chip, the terminal will ask for your PIN after you swipe your card. Simply press “ENTER” and your transaction should be approved. After you have signed the printed receipt, you may be asked to show photo identification. Vending machines, e.g. at unattended petrol pumps, are not allowed to accept cards without a PIN.

MasterCard and Visa are universally accepted, other cards are not. American Express is widely accepted, Diners Club is less common. Theoretically, you can use a Discover Card anywhere you see the Diners Club International acceptance mark; however, almost no merchant will know this. So as long as you have a Chip & PIN card, it’s worth putting it in the terminal and trying it out. UnionPay cards are accepted at the 420 Bank of New Zealand ATMs around the country and at selected EFTPOS merchants.

Costs in New Zealand

New Zealand is a fairly expensive country for most visitors, as its relative isolation increases the cost of imports. Prices are comparable to those of neighbouring Australia, although individual items can vary both up and down.

As a guide, here are the average prices of some common items (as of September 2016):

  • Bread (600g) – 1.10
  • Two litre milk bottle – $3.30
  • Apples – $2.80 per kg
  • Potatoes – $2.40 per kg
  • Lamb chops – $13.40 per kg
  • Fish and chips, one portion – $6.30
  • Big Mac – $6.00
  • Glass of beer (400ml) – 6,20
  • Cup of coffee (flat white) – 5,00
  • Petrol (91 octane) – $1.75 per litre

Taxes and fees in New Zealand

Advertised prices usually include Goods and Services Tax (GST), a 15% sales tax – exceptions must state that GST is excluded or additional. Some shops, especially in tourist destinations, ship purchases abroad or make them available for collection at the airport, as exported goods are not subject to GST. Find out about this service before you make your purchase. GST is levied on goods purchased and taken home.

Some restaurants and cafés charge a 15% surcharge for public holidays, often justified by the need to cover the cost of higher wages for staff working on public holidays (staff working on public holidays are required by law to be paid one and a half times their regular wage and given a paid day off to take later).

Price negotiation in New Zealand

Due to strict fair trade laws, the posted price is usually the purchase price of most goods sold in New Zealand. The principle of The posted price is the price you pay is strongly rooted in New Zealand culture.

Most retailers do not negotiate on price, although some have a formal policy of aligning their prices with the competition and will match or even lower their prices for you if you can find a better price for exactly the same product elsewhere within a reasonable distance (for example, Wellington and Lower Hutt, but not Wellington and Auckland). However, this seems to be changing as there are stories of people finding that appliance and electronics shops are very willing to negotiate prices to get contracts, especially if you are looking for high-end items or if you have a list of several high-priced items. In some places, you will have to ask for a discount, while in others, salespeople will offer discounts on expensive items as soon as they approach you. With the exception of high-end home appliance shops, haggling is generally considered extremely rude. As a customer, it is considered a waste of time to set the price of goods at a reasonable level (and a shopkeeper would be wasting his time if he set the price too high in the hope that customers will haggle).

If you are in New Zealand for an extended period of time, the Trade Me website offers a business model similar to that of the foreign giant eBay. However, Trade Me focuses more on direct bank transfer transactions (the requirement is that you have a New Zealand bank account) and there is little or no fee for registering an item for the first time.

Tipping in New Zealand

Tipping is not part of New Zealand culture and is often treated with suspicion or active disapproval, as many people see it as a largely American custom that overcompensates some workers while leaving others out; there is also a perception that tipping means paying twice for a service. Do not be surprised or offended if you receive astonished looks or your tip is initially rejected or questioned, as New Zealanders themselves do not generally tip and it is also a form of politeness in New Zealand culture to initially decline such a gesture before accepting it. Nevertheless, some forms of tipping are common, such as rounding up a taxi fare. However, it is almost as likely that the taxi driver will round down the fare to the nearest dollar. In some cafés, there is a jar on the counter labelled “Tip the staff” where customers can leave change.

Occasionally people will tip in a restaurant for exceptional service, especially in big cities like Christchurch, Wellington and Auckland. But in these cities it is increasingly common for bar staff, especially waiters, to receive tips of around $30, which accumulate over the course of the evening. Again, this is not a percentage of the bill, but a simple gesture of goodwill on the part of the patrons. Others may feel that people who do this are ostentatious and flaunt their wealth. New Zealanders travelling abroad often find this custom difficult and confusing. It is customary and polite to donate the change from the meal to the charity that has a collection jar on the counter, and this usually replaces the tip.

However, many New Zealanders travel and live in other countries, often returning to New Zealand and taking the habit of tipping with them. Generally, people who provide a service in New Zealand, such as waiters and hairdressers, are tipped in the form of a smile and a thank you, rather than money. This is considered appropriate as their average salary is significantly higher than their American counterparts.

Shopping hours in New Zealand

Most shops must remain closed on Christmas Day, Good Friday, Easter Sunday and before 1pm on Anzac Day (25 April). Exceptions are dairies, convenience stores, petrol stations, cafes and restaurants, pharmacies and some other shops in airports and tourist attractions such as Taupo and Queenstown. If you are in New Zealand on one of these days, make sure all your needs are met by then.

Large retail chains in New Zealand

There are three major chains in the supermarket sector: Countdown, New World and Pak’nSave. If you are looking for the lowest prices, Pak’nSave is probably your best bet. However, they only offer a limited range of brands, force everyone to take their own bags, and if you forget your reusable bags, they charge 10c per plastic bag. They even use stickers in their advertising to show how cheap they are. Countdown and New World are pretty much the same except the former is run by Australians and the latter by New Zealanders. They offer a comprehensive range and the checkout staff will pack your bags for free, but watch the prices if you’re on a budget. Countdown has a voucher card called Onecard; you can pick up a temporary visitor card at the supermarket and most hotels and motels if you want to take advantage of the discounts.

The Warehouse, commonly known as “The Red Shed”, is the New Zealand equivalent of Walmart. The Warehouse Group sells a variety of cheaper products including clothing, camping equipment, electronics, toys, CDs, DVDs, games, etc. The Warehouse Group is also known as “The Red Shed”, the New Zealand equivalent of Walmart. There are regular shops in all cities and most major towns, and there are also some small shops in rural towns. Despite the Walmart-like reputation, the shops sell some prestigious high-end brands such as Sony, LEGO, Apple and Adidas. The motto of the shops is “where everyone gets a good deal”. Prices are reasonable, and if you are buying products to use during your New Zealand holiday (and not planning to take them home), it is advisable to use The Warehouse. The more traditional department stores are the mid-sized Farmers and high-end department stores in the big cities: Smith & Caughey’s in Auckland and Ballantyne’s in Christchurch.

Other “superstore” chains include Briscoes, a homeware shop (which seems to offer a “30-60% discount on all sales” every other weekend), Noel Leeming, an electronics retailer, and Mitre 10 Mega, a DIY shop.