Tesco Ireland has slashed prices by almost a quarter at a clutch of stores to stem the flow of cross-border shoppers seeking bargains in Northern Ireland due to the strength of the euro.
The move covers 12,500 goods at 11 stores near the border with Northern Ireland, with the price cuts averaging 22%.
The weakness of the pound against the Euro combined with the economic downturn has seen a stream of Irish shoppers head north, with Sainsbury's and Asda picking up market share despite having no retail presence in the Republic.
The stores were closed last weekend as Tesco moved to implement the cuts.
“This substantial investment will enable us to compete in the long term with prices north of the border and will remove the incentive or the need for consumers to travel, which has been bad for jobs, for local economies and the national economy," said Tesco Ireland chief executive Tony Keohane.
“When currency costs and travel and journey times are taken into account, we believe many customers will find it is cheaper to shop in these stores south of the border.”
Tesco said it was able to cut prices by improvements in managing its supply chain and sourcing products to UK-based suppliers.
“Our main initiative [concerned] the international suppliers, bringing the benefit of the currency reduction to bear on this marketplace – and to do that we are now sourcing directly,” Keohane added.
The Independent has reported that the new pricing regime could lead to redundancies among distributors in the Republic.
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