Tesco Ireland has launched a new price-cutting campaign, with it rolling out reductions across 700 everyday grocery products in what a government minister described as a “turning point” for food inflation.
The cuts are across a wide range of Tesco own-label and branded lines, with an average decrease of 10%.
The retailer stated that reductions were a key part of its “commitment to give customers great value on their shopping and will complement other value offerings such as Aldi Price Match and exclusive deals through Clubcard Prices.”
Tesco has also been cutting the price of everyday items such as milk, bread and pasta in the UK to reflect falling commodity costs.
Like the UK, Ireland has suffered from soaring food inflation over the last 18 months, with latest industry data from Kantar showing it was running at 16.5% over the 12 weeks to 14 May.
Tesco Ireland Commercial Director, Joe Manning, noted that the retailer had worked “very closely” with its suppliers to manage their input inflation and their cost price pressures.
“As our costs are reducing from our suppliers, we are now able to pass those savings on to our customers,” he said.
Ireland’s Finance Minister Michael McGrath applauded the cuts and predicted that food inflation had now peaked.
“These reductions are very good news for consumers, and I think they will be warmly welcomed,” he said. “Everybody has seen the really significant spike in prices over the last 18 months or so. So it could be a significant turning point in relation to grocery prices for consumers.”
McGrath added that he would “expect” other retailers to respond, predicting that it would only be a “matter of time” before similar cuts were seen across the sector.
NAM Implications:
- Now depends on shopper perception…
- i.e. 700 everyday items vs basic shopping repertoire of cash-strapped consumers.
- That said, a 10% drop in prices has to help.
- A pointer for all can include the discounters…
