Supermarkets drop bread prices to get bigger slice of market

JANE HARPER
FEBRUARY 02, 2015
HERALD SUN
THE bread bin is the new battleground in the supermarket price wars.
Coles has dropped the everyday prices of a range of its bread brands in a bid to claw market share away from its larger rival, Woolworths.
Last year, Woolworths slashed the price of its Homebrand bread to 85c.
And last month it also cut the price of Helga’s brand bread in its latest Cheap Cheap campaign.
But Coles has now upped the ante by extending its own promotions to a range of bread brands including Abbott’s Village Bakery, Tip Top, Wonder White, and Helga’s.
Prices on some items have now been dropped by as much as $1.79.
Coles unveiled its lower prices yesterday, and said that by next week more than 90 per cent of bread offered in its stores would be on the “everyday value” pricing model.
“The average Australian household buys two loaves of bread per week, making these everyday price reductions one of the most effective ways to deliver savings to our customers,” Coles spokesman Blair Speedy said.
“Customers no longer have to wait for their favourite bread to go on special.”
The two supermarket titans have been locked in an aggressive price war for the past five years.
The launch of $1-a-litre milk was followed by a wave of other offers including petrol dockets offering heavy discounting.
The Australian Competition and Consumer Commission clamped down on this discounting last year.
Both supermarkets have also come under fire for their treatment of suppliers in their drive to lower prices.
Coles now faces $10 million in penalties after settling with the competition watchdog.
But the supermarket says it remains committed to helping customers cut their shopping bills by lowering prices on the most popular items.
The supermarket said that the average Australian household’s annual shopping bill was now as much as $570 lower that it had been in 2009.
“Coles is absolutely committed to bringing down the overall cost of shopping for Australian households,” the supermarket said.