Co-operative Group invests £50m in long-term price cuts

  • Print
  • Share
  • Comments (7)
  • Save

The Co-operative Group has cut the price of hundreds of products in a £50m long-term investment.

A total of 640 products – including own brand and mainstream brands – have been cut by an average 14%, with some products slashed in price by more than 40%.

Based on purchasing eight of the cut-price lines each week, the Co-op estimates that shoppers could save £119 per year on their food bills.

Fairtrade bananas are down 16p to 79p, a whole cucumber has been chopped down 18% in price to 45p, baby plum tomatoes cost 77p - down 22p - and a lettuce is 15% cheaper.

A cheese and tomato pizza has dropped almost a third to 55p while 29 Co-op ready meals cost almost 25% less. These include a sweet and sour chicken egg fried rice or chicken korma with pilau rice meal which can be bought for £2.75 each, down from £3.59.

British-produced goods are among those with price cuts, including beef mince down 50p to £1.89, honey roast ham down from £2 to £1.59 and bacon trimmed by 30p to £2.09.

Co-op Retail chief executive Jo Whitfield said: “Many shoppers feel the pinch after Christmas and we are committed to offering our customers value for money and cutting prices to make household budgets go further.

“We are the most visited food retailer on the high street but competition is tight and we want to keep attracting shoppers through the door. Big discounts across fresh food makes it easier for customers to shop healthier as well as fill their cupboards and these price cuts are part of our strategy to make Co-op the UK’s number one convenience retailer.”

Readers' comments (7)

  • So slashing margins then. Not what deluded Nisa and Costcutter stores were expecting. They seem to think that the Co-op will give them bigger margins across the range.

    Unsuitable or offensive? Report this comment

  • Be interesting to see what the wholesale prices look like and how this effects independent retailers margin? Many predicting a price war within convenience when Tesco / booker goes ahead..

    When Cosctutter apply their margin on top will retailers margin be under more pressure?

    Unsuitable or offensive? Report this comment

  • Yeah,many are predicting lots of things just like when Booker merged with Iceland. That went well. Why do people reckon Tesco will do so well with Booker when their diversification history is disastrous.?

    Unsuitable or offensive? Report this comment

  • How many of us compare our prices against the competition every week? or even month? Price reduction will cut the margin for the Co-Op's own stores but clearly I would suggest its a case of staying competitive on price which they are not in many areas and to be honest most of us are not either. The customer is king now, price competitiveness goes hand in hand with store environment and service, note how all the examples in this article are fresh food lines. When Budgens rolled out Tesco price match many retailers saw volumes on those lines increase significantly, which can offset the cash margin decline seen on those sales at an individual level.

    Of course there are no guarantees and the quantity of Co-Op own label fresh which now price marked or have multi buy stickers on them is increasing so retailers stocking these products will not have the option to price them differently.

    Interesting times.

    Unsuitable or offensive? Report this comment

  • What about the coop £5 frozen food deal? Currently offering over £12 worth for £5.are Costcutter shops prepared to run loss leaders like that?

    Unsuitable or offensive? Report this comment

  • Jaded Retailer, it is part of your remit as a retailer to know your competition. I would have thought checking prices would be something professional c-store operators would do at least monthly.

    Unsuitable or offensive? Report this comment

  • Professor, I think I made have not made the point clear. Its the old margin % versus the cash margin debate, i.e. selling products to the customers cheaper and having the increase in volume justifying the lower RSP.

    I naturally lean to the latter because I believe food retail is a volume model. I know plenty of retailers who make a good argument for just focusing on % margin but ultimately businesses prosper on cash generation first. Just look at how much effort is put into promotions across the food retail sector. We 'happily' drive volume through our promotion mechanic everyday in our sector and the customer is becoming more and more immune to it. They expect more EDLP and the Co-Op has been out of line in regard to this and has become too expensive in certain areas. I think independent stores selling good quality, price competitive products should be better for them than delivering a limited, expensive fresh offer which I see all the time.

    To your point though I have no idea what margin or cash margin will be, so my argument could be muted if the WSP is not sustainable for an independent to live with.

    Totally agree on competition, no question but I will put my hand up and say I don't check thousands of prices every week or every month against the Co-Op or anyone else. I look at a handful of KVI's like many. I expect my symbol to be bench-marking retail prices against the market and making sensible category decisions.

    Benefits of the symbol model is that product and price maintenance files are maintained by them along with a compelling promotion strategy.

    I tip my hat to you if you are however!

    Unsuitable or offensive? Report this comment

Have your say

These comments have not been moderated.

You are encouraged to participate with comments that are relevant to our news stories. You should not post comments that are abusive, threatening, defamatory, misleading or invasive of privacy. For the full terms and conditions for commenting see clause 7 of our Terms and Conditions ‘Participating in Online Communities’. These terms may be updated from time to time, so please read them before posting a comment.

Any comment that violates these terms may be removed in its entirety as we do not edit comments.

If you wish to complain about a comment please use the “report this comment” facility or email groceremails@wrbm.com

Mandatory
Mandatory
Mandatory
Mandatory

Related images

  • logo
  • Print
  • Share
  • Comments (7)
  • Save
Sign in

Newsletter Sign-up

I wish to receive the following newsletters:

FOLLOW US