Tesco increased the retail price of its bananas this week to 77p a kilo on loose fruit - 10p higher than Sainsbury’s, Morrisons or Asda.
The store was apologetic about the price hike at a time when retailers have been engaging in price wars as their customers feel the squeeze of rising fuel and energy prices and the credit crunch. “We are committed to offering our customers great value and have a number of different offers running each week, including our fruit and veg pledge which promises to cut prices weekly on favourite fruits and vegetables,” said a spokeswoman for Tesco. “Unfortunately due to costs in the supply chain we do have to occasionally raise the prices of some items.”
The Tesco move came just after Asda’s one-off, weekend-long price cut on bananas to 50p a kilo, that also saw melons and grapes reduced.
“Going back up to 77p only puts prices back where they were six to eight weeks ago,” said one insider. “What is unusual is that Tesco has taken this initiative rather than just following Asda. The problem with bananas is that they are seriously undervalued - while they might represent 24-25 per cent of fruit volume sales, they only account for 15 per cent of the spend.”
An Asda spokesman said the store was constantly reviewing its prices, but two days after Tesco’s move a kilo of loose bananas was still at 67p in both Asda and Sainsbury’s.
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