Delhaize slashes prices to maintain market share

By Leah Vyse

- Last updated on GMT

Related tags: Retailing, Supermarket, Wal-mart, Delhaize

Delhaize has cut the price of 1,000 products in an attempt to fight
back in the Belgian retail price war with discounters and foreign
rivals.

Last year French rival Carrefour, which operates hypermarkets and supermarkets there, ran aggressive price cuts and promotions. This along with the increasing presence of discount retailers such as Aldi, Lidl and domestic rival Colruyt forced Delhaize to act.

Delhaize, Belgium's second largest supermarket chain, has also launched an advertising campaign to raise awareness of its product range which consists of both economy and premium products in a bid to combat its reputation as an expensive retailer.

Arthur Goethals, head of Delhaize for Central and Western Europe said: "The thing that has changed fundamentally is the impact from discounters. Aldi, Lidl and Colruyt have changed the scope of competition."

"Every week we calculate our prices on the basis of price recordings at our competitors' stores. We will continue to adjust our prices in the future if necessary in order to offer customers a fair price every day."

"There is not really a change, but we are working harder because the perception is there with customers that we are more expensive. What we are trying to show is that for some products we are as cheap as our main competitors."

Goethals maintained that the company still hopes to increase its market share in the future from its current 26 per cent share, 3 per cent behind market leader Carrefour, but he failed to specify when this might happen.

The company's expansion plans for 2006 have confirmed the confidence it has for its future in Belgium. It hopes to open three supermarkets and four hypermarkets in the Benelux region, along with 21 convenience stores.

Delhaize Group currently operates in eight countries spanning three continents. At the end of September 2005, its sales network consisted of 2,629 stores.

Related topics: Market Trends

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