Latest update October 14th, 2019 7:27 AM
Apr 25, 2014 Peter Rabbit General News Comments Off on Farmers fear supermarkets’ cost cutting culture could hurt them
Will a supermarket price war damage our farmers? Philip Bowern weighs up the scenarios.
The big four supermarkets’ grip on the grocery market once seemed unassailable. Tesco, Sainsbury’s, Morrisons and Asda had food shopping all sewn up. While competition between them was fierce – and suppliers often suffered as a result as they drove down farm gate prices – no other retailer could touch them.
How quickly things change. The big four are still very significant businesses and still control a substantial share of the market. But the discounters, Aldi and Lidl, are snapping at their heels, stealing their customers and driving down their profits while at the top end independent specialists, farmers’ markets and Waitrose, the supermarket of choice for the well-off – and for treats and special occasions for the rest of us – are taking chunks out of the big four’s market share.
Tesco and Morrisons have been hit hardest. Tesco group’s trading profit was down 6% in the most recent figures with a 1.3% fall in like-for-like sales in the year to February. They are still making a massive trading profit of £3.3 billion but in a company used to year-on-year growth any dip is a worry.
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