BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh
BBCi CATEGORIES   TV   RADIO   COMMUNICATE   WHERE I LIVE   INDEX    SEARCH 

BBC NEWS
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 


Commonwealth Games 2002

BBC Sport

BBC Weather

SERVICES 
Tuesday, 28 August, 2001, 05:52 GMT 06:52 UK
UK 'poised for supermarket wars'
Supermarket logos
Rivalry between UK supermarkets is set to escalate into a full-scale price war, retail gurus have warned.

Although UK grocers in the late 1990s opened a gloves-off fight for customers, there has been a "marked relaxation in the intensity of competition" in the sector in the last nine months, a report by consultants Verdict Research said.

Verdict put the rise down to the integration of a new management team at Asda, the US retailer bought by Wal-Mart two years ago.

Asda, which Wal-Mart has pledged to take above Sainsbury and even Tesco in the UK supermarket league, is now poised to spark a new battle for trade, the report said.

The opening shots in the price war could be fired by Christmas, to the benefit of customers and the UK as a whole, the consultancy said.

"A more competitive trading environment should be good news for customers and the economy at large, both beneficiaries of low inflation," the report said.

Asda unrest

Asda's leading role in the grocery wars assumes minimal disruption from the loss of company president Paul Mason, who it was announced on Friday has been poached by discount retailer Matalan.

The loss represented the second top-ranking resignation in less than a year, after Allan Leighton quit as president last September.

Seven other senior staff members have quit, including Mike Coupe, who joined Iceland as managing director, and Justin King, now managing director of food at Marks & Spencer.

Tony DeNunzio, Wal-Mart's European finance chief, is currently seen as favourite to become Asda's next president..

Tesco praised

In Tuesday's report, Verdict also said it rated Tesco as the UK's highest rated supermarket, thanks largely to the retailer's "growing skill as a hypermarket operator".

While Waitrose and Marks & Spencer remain strong in the grocery sector, Sainsbury and Safeway may fare less well from a price war, the report said.

See also:

29 May 01 | Business
Big future for supermarket giants
15 May 01 | Business
Asda to create 10,000 jobs
11 Apr 01 | e-cyclopedia
Hypermarket economy: Checkout the big boys
09 Apr 01 | Business
The billion pound grocer
10 Apr 01 | Business
Tesco profits top 1bn
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories