Sainsbury’s is launching another round of price cuts amid the battle to hold onto and win new customers in the wake of the pandemic.
The chain and its Big Four rivals have performed well during the last year as people bought more groceries online and chose larger stores to carry out full shops during the crisis. However, with restrictions and concerns around Covid-19 starting to ease, recent industry data suggests shoppers are returning to the discounters.
Sainsbury’s cut prices across 250 branded and own-label lines in February as part of its new Aldi Price Match scheme. The supermarket chain said today that it was investing a further £50m in reducing the cost of another 60 core fresh produce, meat, and dairy products. The cuts will be introduced throughout July and remain in place for the foreseeable future.
The latest round of price reductions include Sainsbury’s Thick Smoked Cut Back Bacon (300g) now £1.50 (a cut of 55p), Red & White Seedless Grapes (500g), now £1.59 (a cut of £41p), and Baking Potatoes, now £1.19 for 2.5kg (a cut of 81p).
Sainsbury’s stated that its current Aldi Price Match and Price Lock initiatives were already making a “significant difference” with good early response from its customers.
Food prices across the industry fell in June for the third month in a row. Whilst this was partly due to the continued battle to win shoppers, latest data compares to the year-ago period when supermarkets were curtailing promotions at the height of the pandemic-led stockpiling.
Rhian Bartlett, Food Commercial Director, said: “Now more than ever we know we need to do more to deliver the great quality customers expect from Sainsbury’s, at great prices. It’s our mission to help everyone eat better and these price reductions are the latest step to show how serious we are about delivering on this promise to customers.
“Including everyday items and recipe essentials, we hope this will help shoppers save on their groceries and enjoy the month ahead.”
The recent bids for Morrisons has led to renewed speculation that Sainsbury’s could become the next takeover target in an undervalued grocery sector. Daniel Kretinsky, the Czech billionaire whose retail investments include France’s Casino and Germany’s Metro, recently raised his stake in Sainsbury’s to 10%, sparking speculation that he might attempt to take the business private.
NAM Implications:
- Following its February Aldi Price Match scheme…
- Sainsbury’s plan to invest a further £50m in reducing the cost of another 60 core fresh produce, meat, and dairy products.
- Hopefully these initiatives will serve in holding back the discounters…
- …and also reduce the possibility of a bid following the move on Morrisons.
