Morrisons chief executive Rami Baitiéh has warned that he expects food inflation will “go up and up over the coming months”, but says the grocer is well-placed to combat rising prices.
Speaking after Morrisons losses deepened in the year despite an uplift over Christmas, Baitiéh said he was “prepared to protect customers” in the coming months, as he expects costs to spiral and competition over price to intensify.
“We believe that inflation is going up and will go up over the coming months,” he said. “I cannot give a clear forecast for the whole year. What I can say is that we are prepared to deliver better prices, better promotions and better loyalty based on our internal capabilities, greater relationships with our suppliers and to improve our offer in terms of price points and promotions to our customers.”
Baitiéh also said that many Morrisons customers struggled with “skint days, skint weeks when they cannot afford everything” and said he wanted to make sure the grocer’s products were “affordable and available to everyone”.
Two weeks ago, struggling grocer Asda pledged to beat the loyalty prices of its competitors, including Morrisons. When asked how much ammunition Morrisons had left in the ongoing grocery price war, Baitiéh said the retailer was “committed” to keeping prices as low as possible for customers.
“Honestly the first thing I look at is my customer’s needs,” Baitiéh added. “Our target is about how to make our product available and affordable to everyone.
“We talk about many retailers, some of them are price focused. Some of them are loyalty focused. But when you look at Morrisons, we are addressing the price, we are addressing the promotions, we are addressing the loyalty, and we are addressing the availability.”
Despite deepening losses at the grocery giant, Baitiéh said Morrisons would be pressing on with its “very clear” trading strategy based around its “value triangle”: better prices, better adapted prices, investment in its More Card membership scheme and better promotions, combined with improved availability and customer experience.
However, he noted that Morrisons still had “a lot more work to do” to win back shoppers it may have lost, particularly given the worsening inflationary environment.
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