Some 249 products will be affected
Asda shoppers are set to notice major price changes across hundreds of everyday items as the supermarket ramps up its battle to be Britain’s cheapest. The chain has slashed the cost of a further 249 products, adding to more than 1,000 cuts announced just last week in a move designed to restore the famous “Asda Price” image ahead of Christmas.
Executive chairman Allan Leighton has vowed to make Asda 5% to 10% cheaper than its main rivals, promising to invest heavily to win back customers. The move is expected to trigger a backlash from rivals, including the likes of Tesco, Sainsbury’s and Morrisons, as well as budget grocers such as Aldi, Lidl and Iceland.
The latest wave of reductions by Asda focuses mainly on fresh food, with 197 items in categories such as meat, fish, poultry and produce falling in price by an average of 7%. Among the biggest drops are Extra Special Raw & Hand-Peeled Jumbo King Prawns (200g), down 50% to £2.12, and Cook by Asda Butternut Squash Chunks (700g), reduced from £2.10 to £1.38, a fall of 34%.
Other examples include Ready Rolled Light Puff Pastry (320g) down 19% to £1.04, Exceptional Lemon Curd Yogurt (150g) cut from 98p to 82p, and Wyke Farms Vintage Cheddar (300g) reduced from £3.53 to £3.18. It comes as supermarkets gear up for a potential pre-Christmas price war, with Morrisons already unveiling its own wave of reductions last month.
At a recent supplier conference, Mr Leighton told more than 600 manufacturers that Asda was determined to reclaim its reputation for value and drive up sales volumes through sharper pricing. The pledge has rattled rivals. Tesco has reportedly lowered its annual profit forecast by £400 million to maintain its competitive edge, while Sainsbury’s is also said to have set aside funds to respond.
Tesco chief executive Ken Murphy appeared to take a swipe at Asda’s strategy during his company’s results presentation on October 2, saying: “It doesn’t feel that rational from where I’m sitting. The share of our results is testament to that.”
Tesco’s UK sales rose 4.9% in the first half of the year – but investors reacted nervously to Asda’s announcement, with the share prices of both Tesco and Sainsbury’s falling by up to 4.3% and 3.1% respectively.