Sainsbury’s ready for price war

British supermarket giant Sainsbury’s yesterday said it was prepared for an escalation of price wars in Britain’s highly-competitive supermarket sector after reporting a decline in underlying quarterly sales.

With profits squeezed by the growth of German discounters Aldi and Lidl, Britain’s “big four” supermarkets have been under pressure to cut prices and improve customer services.

Wal-Mart, the owner of the Asda chain, said last week it would shift the strategy of its British business from safeguarding profit to protecting market share, indicating a new price offensive is on the way.