Just hours after Morrisons said that it would cut prices by an average of 20 per cent on 935 products as part of its efforts to support families struggling post-Christmas, retail giant Tesco has also announced that it would be slashing prices of hundreds of products this month.
Tesco said in a statement: “Today, to celebrate our centenary and to mark 100 years of great value, we’re reducing the price of hundreds of products across the month.”
Morrisons told media that its decision follows customer feedback that found shoppers struggle to save money in January as credit card bills from Christmas land and they re-stock their cupboards with healthy foods and winter warmers.
Morrison’s Andy Atkinson, added: “We’re listening to customers who are telling us that their budgets will be stretched in January, so we are cutting every penny we can on the essentials.”
Duncan Brewer, retail partner at consultants Oliver Wyman, told the BBC that retailers did not have much room to cut prices further: “The grocers’ margins are low by historical levels, so they have limited room for manoeuvre, given the impact of the discounters over the last decade.
“While they will continue to fight for every customer, without a major step-change in their cost-base, they will find it hard to keep investing in ever-lower prices.”