Tesco chief executive Sir Terry Leahy has told suppliers that they must cut prices to help consumers under growing financial pressure.
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Speaking at a private City Food Lecture at the Guildhall yesterday (29 January), Sir Terry told the food industry that prices would have to come down on the back of falling commodity prices.
“These lower prices need to be fed into the supply chain, and passed on to consumers who are under growing financial pressure,” Sir Terry said. “We want to ensure that all our suppliers understand this, which is why we are going to great lengths to talk to them about the new pressures that consumers are under.”
Sir Terry pointed out that commodity prices are down over 50% from their peak, and the price of a barrel of oil is down by about a hundred dollars from the height it reached last year.
“This adjustment affects our entire industry,” he added. “It will be difficult for some, but it is critical if consumers are to be given what they want. Think of the alternative: keeping prices as they are, and hoping against hope that consumers on tight incomes will buy our goods.”
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