The head of German supermarket and convenience store operator Rewe Group has heavily criticised the pricing strategies of discount retailers in the country, calling their approach to the market 'absurd'.
Speaking in an interview with the Frankfurter Allgemeine Zeitung, Rewe Group chief executive Alain Caparros said discounters were running the risk of hurting suppliers while failing to generate bigger sales volumes.
'I can't understand at all why the major discount players are preparing to reduce their prices even further, without the justification of having lower purchase prices,' he told the newspaper.
In order to achieve deflation of between 1.5 per cent and 2.5 per cent, he suggested, the discounters would have to work extremely hard and invest heavily in logistics up to the point of sale.
He also said he felt further price decreases would not lead to an increase in consumption levels among German consumers.
