Price Wars – is it getting out of hand?
Retailers to ‘come out fighting’ after Tesco’s pledge to cut more than 700 grocery items, a report in the Irish Times has claimed. The move is likely to put pressure on other supermarket chains to follow suit, leading to significant savings for Irish consumers.
How will this impact the convenience sector? The mantra ‘less is more’ may apply here – as more consumers opt for smaller shops more often to save on costs, by only purchasinf what they need, when they need it – rather than the over-rated weekly ‘big shop.’
Ireland’s other supermarkets could follow Tesco’s lead in reducing the price of hundreds of products or risk losing market share, a retail analyst has suggested to the Irish Times, bringing on a ‘price war’ scenario.
Tesco said it has cut the price of more than 700 products with the price cuts averaging 10 per cent and including both own-brand products and branded products covering grocery staples as well as household and health and beauty products.
A 10 per cent cut in the cost of a weekly shop would amount to savings of more than €500 when spread out over the course of a year and if it is replicated by Dunnes Stores, SuperValu, Lidl and Aldi, it could have a significant impact on household budgets as well as pushing food inflation lower.
Tesco Ireland’s commercial director Joe Manning told the Irish Times that the discounts were applied to “a hugely diverse range of items including grocery staples [and] household products”.
Meanwhile Kantar says the relentless rise of small FMCG brands has sent a warning to industry giants. However, astute big players perceive this signal differently – it’s an invitation to embark on a strategic shopping spree.
As cash-strapped consumers embrace the allure of alternative options, these emerging brands are seizing the spotlight, steadily gaining ground. What’s intriguing is that many of these up-and-comers have become targets on the very “shopping list” they’ve disrupted.