Leadership

Tesco cuts Dublin prices

30.06.2009
Supermarket giant Tesco has announced it is to lower prices in its Dublin stores.

The retailer took out full-page advertisements in several newspapers this morning, telling customers that the price cuts that had been made in its stores in the Border area in recent weeks would be extended to nine of its Dublin stores.

Seven weeks ago, the retailer cut prices in 11 of its stores in the border counties across a broad range of products. It said at the time that the prices of some 12,500 products were being reduced by an average of 22pc in its border price-reduction programme.

Speaking on RTE’s Morning Ireland programme today, the chief executive of Tesco Ireland Tony Keohane said the programme had worked “extremely well”.

“Our car parks are busier again, the aisles are fuller again, so customers are back shopping in stores in the border towns.”

“We thought it was extremely important for Ireland to stop people shopping across the Border, so we’ve benchmarked our prices against the Border,” he explained.

Following some “minor tweaks”, Keohane said that Tesco had moved the price reductions down the west coast through Mayo and Galway over the past few weeks, and into Dublin stores today.

Commenting on a story in the Irish Times this morning that Tesco had raised prices on hundreds of food items just one month after they had been reduced in its border stores price-cutting campaign, Keohane said the article had “completely missed the point”. He said the retailer’s border price cuts had been a “massive undertaking never seen in Irish retailing before”.

According to the Irish Times article, Tesco confirmed to the paper yesterday that it had increased the prices on 200 product lines in its ‘change for good’ stores, which stock a large amount of products directly imported from the UK rather than sourced from Irish suppliers. However, the retailer also pointed out that some 300 items had fallen in price since new store layouts were introduced in border county stores and those in Connaught.

Keohane said the massive move between sterling and the euro had allowed Tesco to rearrange its contracts and change its supply chain operation, which meant it could offer lower prices to consumers.

He said that both Tesco and its suppliers were paying for these price reductions.