AF Blakemore is lowering wholesale prices on key lines for Spar retailers in its loyalty scheme.

The 'improved terms package' unveiled at Blakemore's Spar conference this week would reduce prices on staple items such as milk, beer and sugar, cutting costs in the average Spar store by about £5,000 a year. The cuts are in addition to a similar scheme launched two years ago, which the wholesaler estimates had saved retailers an average of £7,000 per store.

The loyalty package has been extended to include forecourt retailers for the first time, opening it up to nearly 100 more sites.

Blakemore also announced a new pricing strategy designed to help improve its value perception. It has adjusted its recommended retail prices on core lines using Tesco's prices as a benchmark , with items that are competitive with Tesco's marked with 'Everyday Value' PoS material.

The scheme is being trialled in Eurospar stores and will be rolled out to the rest of Blakemore's Spar stores by the end of the summer.

"This will help to reassure shoppers about our prices, and create a change in their price perceptions," said MD Dennis Evans. "We are confident the plans will help our retail partners to grow sales and profits."