Tesco has said that it has cut the prices of more than 5,000 grocery products in Ireland following the deregulation of the sector with the abolition of the Groceries Order in May. And the retailer doesn’t intend to stop there: Tesco Ireland plans to reduce the price of a further 5,000 products by early 2007.
The company said the move would mark the completion of the first stage of the company’s commitment to reduce the price of all grocery products previously controlled by the Groceries Order, which prohibited below-cost selling.
The Groceries Order governed the price of various staple products such as bread, pasta, eggs, juice, butter, cereal, yoghurt and biscuits.
Commenting, Dermot Breen of Tesco Ireland said: “This price reduction programme is the most significant ever undertaken in the Irish supermarket industry. It means that the prices of 5,000 grocery products are now lower than six months ago, despite national inflation currently running at over 4%.”
“We will be continuing this process and plan to reduce a further 5,000 prices by early next year and so helping to reduce the cost of shopping for all our customers”
The price cuts look set to spark a price war, with local Irish supermarket operator Dunnes Stores expected to retaliate with reductions of its own. Dunnes currently controls 22% of the Irish grocery market.