TESCO UNVEILS NEW LOW COST PRODUCT RANGE - The latest phase in the Irish supermarket price war kicks off today. Older listeners will remember yellow pack - the cheap-own branded goods brought in by Quinnsworth to fight competition back in the 1990s from the likes of Dunnes Stores and Superquinn. Quinnsworth then became Tesco and it has now decided to bring in black and amber pack. It is going to set aside a few aisles in most of its stores around the country for cheaper own branded goods and some branded goods as part of what it is calling its Cashsaver schemes. It also promising to pass on savings arising from the euro strengthening in value against sterling.
This is not a humanitarian gesture - Tesco is facing stiff competition from Lidl and Aldi. A survey carried out by the National Consumer Agency recently showed that the two discounters were much cheaper than Tesco and Dunnes Stores for a typical basket of goods.
Tesco Ireland's CEO Tony Keohane says that the supermarket chain has been price cutting for some time, but says today's announcement concerns 3,000 immediate price cuts with another 2,000 to follow in later months. He says that Tesco Ireland is making easier for customers to spot those cut prices in its stores. He says that Tesco has been listening to its customers and realises that times are tougher for consumers and this move is a response to customers' needs. He says this is a strategic move from the company to bring a new level of competition to the market place.
Mr Keohane denies that the likes of Aldi and Lidl are taking a big share of its business and says that Tesco's market share is still growing. He says the price reductions announced today are permanent and are not promotional. He says that when people walk into Tesco stores on Monday they will see specific aisles with lower price on every day items.
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MORNING BRIEFS - Reports overnight fuelled fears that Britain, the euro zone, Japan and the US are sliding toward recession. German business sentiment this month suffered its biggest decline since the 2001 terrorist attacks in New York and Washington, while existing US home sales were at the lowest in a decade. However, if the big euro zone economies continue to deteriorate, it could encourage the European Central Bank to reduce interest rates.
