Safeway is to trial a low cost fresh food supermarket to allow it to roll out "total localisation". The 15-18,000 sq ft stores are planned for less affluent areas and will trial lower building and fitting costs along with different ranging. Safeway has not released details on where or when the pilot stores will open, but a spokeswoman said it would probably be early next year. "It will be a fresh food range but with fewer high margin activities, such as the fresh coffee bar." She added: "We're about pricing by format and if you're in a less prominent location you can offer lower prices." Finance director Simon Laffin said the stores would be adapted to the local environment. "We're not in the business of one size fits all and I'm not ruling out changing existing stores either." The company has also announced its Biggest Savings Ever campaign which promises to give customers an extra £120m of price savings. To back this up, the chain reported first quarter like-for-like sales growth of 6.1% with customer numbers and average spend growing. However, analysts at ABN Amro said Safeway's non-promoted lines were 12% more expensive than Asda and 7% more expensive than Sainsbury. It added that Safeway had a high and rapidly growing reliance on promotions. ABN Amro analyst James Collins said: "Promotions account for 30% of Safeway's sales and a lot of people just go there to cherry-pick the deals. "It needs to get a bigger average basket size." The spokeswoman defended its prices. Although products not on promotion would be a few pence dearer than its competitors', an average Safeway basket was as competitive as Tesco and 10% cheaper than Sainsbury, she said. The Grocer 33 also shows Safeway's prices coming back down in line with its rivals. A 100g jar of Nescafé was at the industry price of £1.65 last week, while six months ago it was 10p ahead. Another City analyst added: "After opening its swish new stores, Safeway thinks it can take on the world, but it needs to increase its sales densities first." {{NEWS }}