Over 16,000 new SKUs have been introduced into UK supermarkets since May, and 11,000 food and drink lines delisted, as retailers and manufacturers brace themselves for a "consumer recession" in 2010.
Average pack sizes have been cut across the board in a bid to suit products to round-pound pricing strategies and lower price points. At 7,258, Asda launched the most new SKUs, and also delisted the most at 5,444. Despite the launch of the Essential range, Waitrose introduced the least at 1,538, while delisting 1,309.
The research, conducted by Brand View, reviewed all lines listed on the websites of Asda, Sainsbury's, Tesco and Waitrose Deliver. Newly listed products were on average 20p cheaper than the products they replaced at Asda, 43p less at Tesco and a hefty 45p cheaper at Waitrose. Sainsbury's, which expanded its premium own-label meat and alcohol ranges, bucked the trend with new listings 60p pricier than delistings.
"We haven't rushed to put out value or basic lines," said one major branded supplier. "But we have looked at creating products with a lower price point. We can afford to promote lines at £1 without losing money. We also believe consumers still want premium products, but have reduced the size of some so the actual spend is not so considerable."
Branded lines made up the majority of the activity, comprising just under 70% of delistings and new listings. Retailers continued to expand their premium own-label ranges, but also added new products to their value ranges.
One senior manufacturing executive said the repositioning work was being done in anticipation of a "consumer recession" in 2010. Although the financial recession was expected to end early in 2010, tax increases and higher unemployment would squeeze consumers as much in 2010 as 2009 or more, he said.
"There is evidence the recession has not yet hit retail with its full force," said Chris Outram, chairman of strategy consultancy OC&C. "There is some deflation to work through, which will hit like-for-like sales hard even if volumes hold firm."
Read more
Galaxy bars shrink 17% to avoid new price hike (12 September 2009)
Unilever demands price hikes on 100 top items (16 May 2009)
Average pack sizes have been cut across the board in a bid to suit products to round-pound pricing strategies and lower price points. At 7,258, Asda launched the most new SKUs, and also delisted the most at 5,444. Despite the launch of the Essential range, Waitrose introduced the least at 1,538, while delisting 1,309.
The research, conducted by Brand View, reviewed all lines listed on the websites of Asda, Sainsbury's, Tesco and Waitrose Deliver. Newly listed products were on average 20p cheaper than the products they replaced at Asda, 43p less at Tesco and a hefty 45p cheaper at Waitrose. Sainsbury's, which expanded its premium own-label meat and alcohol ranges, bucked the trend with new listings 60p pricier than delistings.
"We haven't rushed to put out value or basic lines," said one major branded supplier. "But we have looked at creating products with a lower price point. We can afford to promote lines at £1 without losing money. We also believe consumers still want premium products, but have reduced the size of some so the actual spend is not so considerable."
Branded lines made up the majority of the activity, comprising just under 70% of delistings and new listings. Retailers continued to expand their premium own-label ranges, but also added new products to their value ranges.
One senior manufacturing executive said the repositioning work was being done in anticipation of a "consumer recession" in 2010. Although the financial recession was expected to end early in 2010, tax increases and higher unemployment would squeeze consumers as much in 2010 as 2009 or more, he said.
"There is evidence the recession has not yet hit retail with its full force," said Chris Outram, chairman of strategy consultancy OC&C. "There is some deflation to work through, which will hit like-for-like sales hard even if volumes hold firm."
Read more
Galaxy bars shrink 17% to avoid new price hike (12 September 2009)
Unilever demands price hikes on 100 top items (16 May 2009)
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