Tesco Cuts Branded Products In Convenience Stores
Tesco, a prominent supermarket group, has revealed its intention to decrease the presence of branded items in key product categories within its convenience stores, responding to the growing demand from financially constrained UK consumers for more economical own-brand alternatives.
The UK populace, grappling with a prolonged cost-of-living crisis extending into its second year, is actively pursuing avenues to save money.
Despite facing a grocery inflation rate of 14.9% in July, as indicated by industry data, and confronting 14 successive interest rate hikes since December 2021, consumers are striving to make budget-conscious choices.
To address this trend, Tesco, the largest food retailer in the UK, has outlined a comprehensive strategy for its 2,000-plus Express convenience stores.
This strategy entails the replacement of more than 50 essential everyday products with more affordable options, a substantial number of which are Tesco’s own-brand offerings. In several instances, the new items are priced at less than a third of the cost of the products they are substituting.
Tesco’s motivation for this initiative is grounded in its internal shopping data, revealing an escalating preference among price-conscious shoppers for own-brand merchandise.
The current market climate has propelled the growth of private-label products in British supermarkets, outpacing the growth rate of branded goods, as disclosed by market research firm NIQ in May.
Among the new additions to the own-brand lineup are Tesco’s 85 pence ($1.08) penne pasta and £1.85 smooth peanut butter, both of which are priced at half the cost of their preceding branded counterparts.
Moreover, bags of Tesco frozen garden peas, available at £1.65, offer nearly a 40% reduction compared to the replaced branded alternative. These novel products are set to reach stores in the upcoming two weeks, with the transition anticipated to conclude by the close of August.
In a separate announcement made in June, Tesco indicated that the peak of Britain’s food inflation had been reached.
