Tesco launches value own-label ranges as it ups ante against discounters

Tesco’s seven distinct ‘Farms’ brands will form a new value proposition for the supermarket giant across its fresh, meat and poultry categories, sitting below its existing ‘Everyday Value’ range in terms of price.

Each of the new labels, which have been “several months” in the planning, carry their own individual name and look and will be “incredibly competitively priced”, sources said.

Retail Week can reveal that from today 76 products will be sold under the seven new brand names, which are:

• Redmere Farms, for vegetables
• Suntrail Farms, for imported fruit
• Rosedene Farms, for berries, apples and pears
• Nightingale Farms, for salad
• Woodside Farms, for pork
• Willow Farms, for chicken
• Boswell Farms, for beef

Tesco is thought to be working with a number of its existing suppliers to stock the brands across its entire store portfolio, including its smaller Express and Metro convenience shops.

Retail Week understands that prices of all products will remain consistent in its supermarkets and smaller c-stores, where shoppers are usually charged a premium for convenience.

However, c-stores will not stock the full range of 76 ‘Farms’ products.

Battling the discounters

The introduction of the new own-label brands mirrors the successful strategies of discount duo Aldi and Lidl.

The German grocers deal largely in private-label goods rather than stocking proprietary brands, but their goods all carry distinct brands such as Newgate and Harvest Morn, rather than featuring the retailer’s name.

Tesco is also bidding to build on the trading momentum it gained over Christmas, when its ‘Festive Five’ campaign – slashing prices on five core fruit and vegetable ranges – helped it grow like-for-like sales by 1.3%.

Sources close to the situation described Tesco’s new brands as an attempt to “create a Festive Five offer all year-round” to permanently narrow the price differential to the discounters across dozens of basket staples and eliminate customers’ needs to shop in multiple locations for the best price and quality.

Tesco is battling to woo shoppers back to its supermarkets by offering better quality and lower prices as it continues its turnaround efforts.

Group boss Dave Lewis along with UK and Ireland chief executive Matt Davies have already overseen extensive range resets, introduced the Brand Guarantee price match initiative and ploughed investment into improving availability and customer service.

A Tesco spokeswoman said: “Over the last 18 months we have been simplifying our ranges, launched Brand Guarantee and improved customer service. However, we know customers want the convenience of getting all their shopping in one place.

“These seven new brands, which are exclusive to Tesco, address our customers’ needs for quality fresh food, at very competitive prices in a single shop.”