With the inflation ongoing and cost-of-living concerns, UK shoppers are seeking better value in local shops.
- A Which? investigation found shoppers at convenience stores paid over £800 more annually than at bigger supermarkets.
- Tesco has initiated product overhauls in their Express stores to offer affordable alternatives, boosting their value reputation.
- Morrisons has followed suit, incorporating their budget range into 500 Daily stores due to consumer demand.
- The shift comes amid pressures for supermarkets to introduce budget-friendly options in convenience outlets.
In the current economic climate, UK consumers are rigorously seeking value for money in every purchase. Research by Which? indicates that those who primarily shop at convenience stores face a financial penalty of over £800 annually compared to larger supermarkets. These findings stem from a noticeable lack of budget-friendly options in smaller convenience outlets affiliated with supermarket chains.
In response, Tesco has announced a transformative move in the product selection of its Express stores. By replacing 50 everyday items with more affordable alternatives, predominantly from their own-brand range, Tesco aims to enhance value for its customers. These changes were prompted by shopping data revealing a growing consumer preference for own-brand products as a cost-saving measure without sacrificing quality.
Following Tesco, Morrisons has also begun offering entry-level products from its ‘Savers’ budget line in over 500 Morrisons Daily stores. These include essential items such as eggs, ham, and basic household supplies. Morrisons’ decision to expand their budget range into convenience stores reflects consumer feedback and demand, especially in areas lacking easy access to larger supermarkets.
The delay in supermarkets introducing budget lines to convenience stores raises questions, particularly given the clear demand. Which? highlights that during investigations, a majority of Tesco, Sainsbury’s, and Morrisons convenience stores lacked budget products. As industry insiders suggest, the economics of smaller stores differ, with higher operational costs compromising the feasibility of low-cost product ranges.
Political and consumer pressures, however, are driving these retail giants to reconsider their pricing strategies. The complexity of convenience store operations involves higher costs, as explained by Morrisons CEO David Potts and market analyst Dr Clive Black. Yet, given the significant consumer demand, illustrated by a 45% difficulty in finding affordable food as per a Which? survey, supermarkets are slowly adapting to include budget options.
Retailers are increasingly reassessing their strategy to incorporate budget ranges in convenience stores, responding to consumer demand and market pressures.
