Superquinn has cut its prices in response to yesterday's price cuts by Tesco, but the supermarket chain's chief executive, Senator Fergal Quinn, says there is no "price war".
"Superquinn policy is to constantly monitor our competitors," he said, "and price changes are implemented immediately should any gaps appear." The Superquinn move follows Tesco's reduction by an average of 18 per cent in the prices of 54 branded goods. Recent grocery price surveys conducted on behalf of the Office of the Director of Consumer Affairs found very little variation in the prices of branded goods.
The lack of variation is in the "realm of the remarkable coincidence", says the Director of Consumer Affairs, Ms Carmel Foley. She has forwarded the results of the surveys to the Competition Authority for consideration.
A comparison of seven branded goods including bread, cereal, sliced ham, biscuits and washing-up liquid, which was carried out by The Irish Times yesterday, found no variation between Tesco and Superquinn.
Dunnes Stores, which declined to comment but provided prices for comparison, were one to two pence cheaper for a few items.
SuperValu said it would not be appropriate for them to do a price comparison as there are currently 309 items on promotion in their stores. "For Tesco to shout about reducing prices by 18 per cent when, in effect, it has reduced 54 items from a total stockholding of over 40,000 items, is incredible," said a spokeswoman.
Mr Kieran Doherty, editor of Consumer Choice, the magazine of the Consumers Association of Ireland, said the reaction of supermarkets to the surveys had been that the lack of variation means competition is tight. "Now, when one supermarket breaks from the pack the others just follow. It begs the question: if they can afford to do this, maybe profits weren't as tight as they were trying to make us believe." Senator Quinn rejected this suggestion and said that in the 40 years Superquinn had been in business 22 companies had gone out of business, mostly because it was such a competitive market.
"The last time Tesco came they only stayed five years - from 1980 to 1985. They are now here almost four years. I am waiting to see if their patience will last," he said.
He acknowledged that this time Tesco had bought Quinnsworth and didn't have to build up its market share to the same extent as in the 1980s. But, he said, "there is still 15 months to go before they beat their last stay".
Superquinn, he said, had introduced some major reductions including cabbage at 9p, 2 litres of Coca-Cola down from £1.19 to 89p, and Kellogs Just Right from £3.12 to £2.55.
The Minister of State with responsibility for consumer affairs, Mr Tom Kitt, said he was particularly happy to see price reductions on branded goods as previous price cuts had concentrated on supermarkets' own brands.