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Could Gloucestershire shoppers cash in on price wars in the aisles?

By Gloucestershire Echo  |  Posted: March 01, 2014

  • supermarket

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FOLLOWING a drop in Tesco's profits, experts have predicted they could trigger a supermarket price war.

Britain's biggest supermarket retailer, Tesco is expected to cut its 5.2 per cent profit margin in order to compete with significant price drops from other shops. Tesco has struggled recently to compete with other supermarkets such as Asda, Sainsbury's and Morrisons. Also the increasing popularity of cheaper retailers such as Lidl and Aldi has pushed the idea forward.

Last year Tesco abandoned trading in Japan and America due to poor trading figures.

The company also had a disappointing festive period as it saw sales fall by 0.4 per cent up to February 4. There was also a 2.4 per cent drop in UK like-for-like sales over the six weeks up to February 2.

Due to rising prices, consumers are now more likely to invest in small local convenience shops and online, rather than going to the large supermarkets.

Tesco chief executive Philip Clarke admitted: "We didn't change enough, not enough for our customers at least.

"Our prices must get better and be more stable."

With the rumours circulating about Tesco's price drop, there is speculation it could result in other supermarkets being forced into further price reductions, triggering a price war.

With 45 per cent of people spending a higher proportion of their available income at the supermarket compared to last year, many people will view this as a positive thing and a potential answer to the soaring price of everyday items.

■ To find out how competitive the major store chains are in the county at the moment, we went out onto the streets of Gloucestershire yesterday to carry out a simple price comparison of a small basket of essential items.

LIDL £16.29

Hovis white bread 99p

Quaker Porridge Oats £1.98 (1kg)

Four frozen beef burgers £1.79

Whole chicken £2.40

Anchor Butter £1.70

Pilgrims Choice cheese £3.99

1 pint semi-skimmed milk 45p

160 PG Tips teabags £2.99

WAITROSE £17.30

Hovis white bread £1.35 (2 for £2)

Oats so Simple Porridge £2.45

Four original Birds Eye beef burgers £1.35

Whole chicken £4.50

Anchor Butter £1.70

Cathedral City cheese £3

1 pint semi-skimmed milk 60p

80 PG Tips teabags £2.29

TESCO £17.37

Hovis white bread £1

Oats so Simple Porridge - £2.99

Four original Birds Eye beef burgers £1.35

Whole chicken £5 (2 for £8)

Anchor Butter £1.75

Cathedral City (350g) £2.50 (half price from £5);

1 pint semi-skimmed milk 49p

80 PG Tips teabags £2.29

MORRISONS £18.70

Hovis white bread £1

Oats so Simple Porridge £2.99 Four original Birds Eye beef burgers £1.45

Whole chicken £4.10

Anchor Butter £1.70 (2 for £2.50)

Cathedral City cheese £4.48

1 pint semi-skimmed milk 49p

80 PG Tips teabags £2.49

ASDA £18.63

Hovis white bread £1

Oats so Simple Porridge £2.98

Four original Birds Eye beef burgers £1

Whole chicken £4.50

Anchor Butter £1.70 (2 for £3)

Cathedral City cheese £4.48

1 pint semi-skimmed milk 49p

80 PG Tips teabags £2.48

SAINSBURY’S £20.14

Hovis white bread £1.35 (2 for £2)

Oats so Simple Porridge £2.99

Four original Birds Eye beef burgers £1.50

Whole chicken £4.50 (3 for £10)

Anchor Butter £1.70

Cathedral City cheese £5

1 pint semi-skimmed milk 60p

80 PG Tip teabags £2.50

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3 comments

  • Matt1006  |  March 03 2014, 8:41AM

    I've started shopping at Aldi, as I seemed to be spending more & more at Tesco each week, with very little to show for it. Do still finish off the weekly shop in Tesco for the last few items I can't get in Aldi, but the bulk of my shop is done in Aldi now, and at much less cost that previously. Not found any Aldi products that I don't like so far. Tesco will have to seriously reduce their costs to entice me back to do my full shop there.

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  • citon  |  March 01 2014, 7:58PM

    5.2% profit margin? Not likely unless that is nett, rather than gross. As an example, Koppaberg pear cider is £2.29 at Tesco. B&M Gloucester are asking 99p and they are not going to be giving it away.

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  • Apothegm_  |  March 01 2014, 4:39PM

    A supermarket price comparison which puts Sainsbury's as the dearest, and Waitrose as slightly cheap than Tesco, is surely not comparing like with like. But Lidl the cheapest? Quite probably. Google for "Shopping at Lidl" and play the YouTube video...

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