Thursday, October 23, 2014 - 09:53
Heavy discounts at supermarkets to continue: analyst
According to analyst Mathijs Deguelle from ABN large supermarkets have forced themselves to continue giving discounts to consumers. "By attempts to get price discounters off their back, they are focusing even more on price," he explains. They also have other issues. The consumers have since become accustomed to the low prices. "So the chains have trapped themselves." Deguelle indicates that 19 percent of sales in the supermarkets are currently being sold at discount rates. Before the crisis it was 12 to 13 percent. Discounters have strengthened their price image and invested in quality by also offering A-brands, for example. According to ABN, the proposition of discounters have become even more attractive. "In response to this, and given the disappointing volumes, ABN Amro thinks that there is a good chance that full service supermarkets will continue to reach for the familiar to them recipe of offers." Deguelle explains that it is difficult for larger chains to escape the focus on price. The first group to focus on other issues, risks missing out on revenue. This is a good thing for the consumer. According to Deguelle, it will be a long time before supermarkets will abandon this policy.