The price of a basket of 23 frequently purchased items at larger Safeway stores has been slashed by 24%, said the company.
Morrisons declined to comment on the trading performance of Safeway stores following the cuts, but told analysts it was seeing good volume gains on reduced lines.
Joint MD Marie Melnyk said the permanent reductions, which now extend to several thousand products, were in addition to bogofs and other offers introduced into Safeway since Morrisons took over. Suppliers said Safeway’s promotional calendar was being harmonised with Morrisons’ this month, while Safeway flyers had disappeared by April 5. Discussions were also progressing on ranging.
One short-shelf-life supplier said: “We’re being told of range changes now, based on a simpler Morrisons range. They seem to be tackling ranges and promotional schedules before terms, but I suppose they want to make an immediate impact in the stores.”
Another said: “We are under no illusions that Morrisons will be looking for benefits. However, our understanding is that existing Safeway contracts will be honoured.”