Grocery vs. Pharmacy vs. Oil Channels — Which Is Right for Your Brand?
When it comes to getting your FMCG product on shelves, choosing the right retail channel is a critical strategic decision.
Whether you’re launching a new beverage, health product, snack, or personal care item, understanding the pros and cons of Grocery, Pharmacy, and Oil (Petrol & Convenience) channels in New Zealand can help you maximise reach, sales, and brand impact.
The Heavyweight Contender
Grocery Channel
Grocery is the dominant retail channel in New Zealand, with supermarket giants like Foodstuffs (New World, PAK’nSAVE, Four Square) and Woolworths NZ (Countdown, SuperValue, FreshChoice) commanding a massive share of FMCG spend.
PROS
CONS
Massive Foot Traffic
Supermarkets attract a wide demographic and are often a one-stop shop for families.
High Competition
You’re fighting for attention alongside hundreds of brands and private label alternatives.
High Sales Volumes
If your product gains traction, velocity and scale are unmatched.
Price Pressure
Buyers expect competitive pricing and regular promotional support.
Promotional Leverage
You can drive short-term spikes through catalogue promotions, end caps, and in-store activations.
Heavy Lifting Required
You’ll need a strong field sales presence, robust logistics, and consistent merchandising to perform.
Full Basket Mentality
Consumers are more open to trial and impulse purchases, especially in the health, snacking, and drinks categories.
Supermarket is best for emerging brands with scalable production, broad appeal, and the margin to support promotional investment. Ideal for beverages, snacks, pantry goods, frozen, and personal care.
The Trusted Authority
Pharmacy Channel
The Pharmacy channel — think Green Cross Health (Unichem, Life Pharmacy) and independent pharmacy groups — is where consumers turn for trusted wellness, OTC health, skincare, and supplements.
PROS
CONS
Health Halo
Products sold in pharmacy gain perceived credibility and legitimacy.
Slower Velocity
Turnover is generally lower than grocery unless your brand has strong demand.
Targeted Demographic
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Limited Shelf Space
Ranging is more selective, especially in smaller independents.
Premium Positioning
Consumers expect to pay more — ideal for higher-margin items and premium formulations.
Different Buying Groups
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Education-Friendly
Staff are trained to explain benefits and recommend new products.
Pharmacy is best for health, beauty, or supplement brands seeking authority, credibility, and premium positioning. A great channel for innovation-led products with a strong USP.
The Impulse Powerhouse
Oil Channel
The Oil Channel — also known as Petrol & Convenience — includes chains like Z Energy, BP, Caltex, and GAS. These outlets serve on-the-go shoppers and are a goldmine for single-serve formats and impulse-driven buys.
PROS
CONS
High Impulse Purchases
Think energy drinks, snacks, RTDs, mints, and grab-and-go items.
Limited Space
You’ll often have to fight for every SKU or shelf spot.
Speed to Shelf
Faster onboarding compared to grocery.
Short Shelf Life
Rotational ranging and limited depth of stock.
Simpler Promotions
Lower reliance on deep discounting or trade spend.
Brand Must Sell Fast
Low patience for slow-moving SKUs — performance is closely watched.
Strategic Visibility
Great for brand awareness and trial.
Oil is best for beverages, confectionery, snacks, and convenience-first brands. Best if you have a bold, high-impact brand that grabs attention quickly.
How to Choose the
Right Channel for Your Brand
The truth? There’s no one-size-fits-all answer. The right retail strategy depends on your brand’s maturity, production capabilities, margins, target audience, and category dynamics.
Where does my target customer shop?
Can I support the logistics and promotional requirements of grocery?
Does my brand need the credibility of pharmacy?
Is my product optimised for impulse purchase or routine top-up shops?
Do I have the right sales and brokerage support for each channel?
Multi-Channel Strategy: Why Many Brands Play Across All Three
Some of the most successful FMCG brands in New Zealand play across grocery, pharmacy, and oil, but they tailor their pack sizes, pricing, messaging, and ranging accordingly. See examples –
A sparkling collagen drink
might offer multipacks in grocery, singles in oil, and premium SKUs in pharmacy.
A skincare brand
might launch with pharmacy exclusivity before scaling into grocery once brand awareness is high.
So where Should
You Start?
If you’re a new or growing brand, the best starting point is usually one core channel — where you can win, build data, and optimise operations — before expanding.
At Surge SMC, we work closely with brands to develop tailored channel strategies that match their growth goals. Whether you’re supermarket-ready or exploring pharmacy and convenience channels, we help you position for long-term success.
Need Support Getting on Shelf?
We’ve helped dozens of FMCG brands enter and scale across grocery, pharmacy, and oil channels. From buyer presentations and brokerage support to field sales and promotional planning, our team can help you navigate the complexity with confidence.
Ready to take your brand to the next level?
Partner with us to grow faster, reach more shelves, and boost performance — backed by expert strategy and deep FMCG know-how.