PRICE SURVEY:Lidl supermarkets are substantially cheaper than Tesco or Dunnes Stores, writes Ronan McGreevy
DISCOUNT RETAILER Lidl remains at least 20 per cent cheaper than Tesco or Dunnes Stores in the Republic for randomly selected essential food items, according to an Irish Times survey.
The survey of 13 essential foodstuffs, including bread, milk, potatoes, carrots and cheese, also found remarkably similar prices between Tesco and Dunnes Stores.
This was the same both before and after Tesco began its discounting campaign at the weekend.
The results confirm earlier surveys carried out by the National Consumer Agency (NCA) into prices between retailers in the Republic and between retailers in the Republic and Northern Ireland.
Tesco says its "new deal" for shoppers will see 3,000 price cuts. However, the Irish Times survey found that prices had fallen for only two of 13 randomly selected products at one Tesco store in Dublin.
The price of the basket of goods last week was €39.86. This week, the same basket was just €1.51 cheaper. The equivalent basket of goods in Lidl was €31.92, giving a difference of 20 per cent.
The survey found Dunnes Stores prices in the Republic were 19 per cent more expensive than those in the North.
The equivalent differential for Tesco prices was 10 per cent, but only 5 per cent for Lidl.
John Shine, the NCA's director of commercial practices, said Tesco's price move was in direct response to its survey in February which showed that own-brand goods were half the price in Lidl and Aldi than they were in Dunnes Stores or Tesco. It also concluded there was no effective competition between Tesco and Dunnes.
"Our provisional response would be that this is a regrouping of products on the part of Tesco to highlight goods in their range that are similarly priced to Lidl and Aldi."
Meanwhile, vegetable growers have expressed serious concern at a possible price war between retailers.
Irish Farmers Association national fresh produce co- ordinator PJ Jones said he was looking to call a national meeting of vegetable growers later this week to discuss a boycott of retailers over price reductions.
He said products such as peppers and cucumbers, which are being advertised at cut-price rates, were being sold at below the cost of production and many vegetable growers would go bankrupt if the price war escalated.
"It is better that we actually rotavate the products back into the ground rather than take next to nothing for them," Jones said.
"Tesco say they have deep pockets and they are going to fund it themselves, but I have reservations about that. When the pressure comes on, we're going to have to pay for it as some stage."
A spokesperson for Tesco was unavailable for comment yesterday.
Shopping: where and why you spend
Main reasons for choice of supermarket:
Convenience 61%
Price 31%
Quality 21%
Parking: 9%
Loyalty: 5%
Source: National Consumer Agency/Amarach research