Musgrave to fight off competitors

MUSGRAVE Group, owners of the SuperValu and Centra retail franchises, warned yesterday it will fight any challenge by competitors to its growing market share.

The group, second only to Tesco in the cut-throat retail sector, was responding to the latest price cut announcements by M&S of roughly 12%.

M&S, Britain’s biggest clothing retailer, said it will cut the price of clothing by 10% and homeware by 12% in its Irish stores with immediate effect.

In response, Musgrave said that along with its retail partners in SuperValu it was “committed to bringing lower prices to Irish consumers while at the same time continuing to source from Irish food producers and suppliers”.

In recent months, SuperValu has reduced the average weekly household basket – which is about €150 – by 7%, it said, as the battle for consumer loyalty intensified.

Over the last year Musgrave has invested in price reductions of more than €140 million and the value of reductions will top this figure in 2009/2010.

SuperValu has achieved “the highest market share growth amongst the multiples since the beginning of the year” and has grown by almost 1% to bring its share of the retail grocery trade in Ireland to 20.5%, it said.

It has already been cutting food prices in its Irish stores for the past three moths, it said, passing the benefits of a weaker sterling on to its Irish consumers.

The price cuts were a response to the economic conditions in Ireland and the impact of currency fluctuations that has seen a significant leakage of shoppers to the North over the past 12 months.

Tesco last month fuelled the price war with the announcement that it was cutting prices by 22% in tandem with a decision to centralise much of its stock purchasing at its British base.

“We know things are tough for our Irish customers at the moment and we want to help them by making our products even better value for money,” Jonathan Smith, head of M&S in Ireland, told RTÉ.

M&S is about to open its 20th store in Ireland.

From today it will cut the price of a man’s suit to €309 from €350 while the price of a €1,500 extendable dining room table will be reduced by more than €225.