Discount chain Aldi is committed to offering customers the “lowest grocery prices” this year, paving the way for a renewed supermarket price war as customers struggle with rising cost of living.
Giles Hurley, chief executive of Aldi UK, said that although 2021 was a “long and difficult year” for many, looking ahead, “the top priority for most families this year will be to manage their household budgets in the light of rising cost of living. ”.
“As the cheapest supermarket in Britain, Aldi will always offer the lowest prices for groceries, no matter what,” he added.
He made his remarks when the German-owned group reported its “best Christmas ever” on Monday, with a 0.4 percent year-on-year increase in revenue in December. Sales were 8.1 percent higher than in the same period in 2019.
According to market research firm Kantar, it was the “only large supermarket” to see increased sales in December.
Aldi and discount competitor Lidl lured consumers with their no-bike proposal after the financial crisis, which prompted larger competitors to cut prices as they tried to stem the loss of sales and unleash an aggressive supermarket price war.
However, the discount retailers continued to take stock of the biggest supermarkets, prompting competitors including Tesco and J Sainsbury to launch Aldi price promotion last year.
Aldi’s price commitment comes as UK households face a cost-of-living crisis due to rising food and energy prices. Supermarkets, including Wm Morrison, the country’s fourth largest grocery store, have warned that the cost of groceries will continue to rise, driven by higher commodity prices and freight rates.
Grocery price inflation of 3.7 per cent added £ 15 to consumers’ shopping bills in December, according to Kantar.
Rising energy bills, due to rising wholesale gas prices, have led the consumer price index to reach a 10-year high and are expected to rise further.
John Allan, chairman of Tesco, said in September that food prices could rise by about 5 percent over the coming months due to higher commodity prices and supply chain disruption.
Aldi also reiterated its plans to create 2,000 jobs in 2022 and to invest £ 1.3 billion over two years, opening 100 new stores and distribution centers.