The days of cheap food prices have come to an end, Spar international managing director Dr Gordon Campbell has said.
Speaking at the Retail Week Conference, Dr Campbell said "we have been lived through an era of cheap food prices and this has abruptly come to an end."
The combination of the financial crisis, the decline in house prices and the sudden rise in grain costs have caused consumer confidence to collapse, said Campbell.
He who urged retailers to adapt to the new challenges in the market and adopt "complete rethinks" of their business models.
"The consumer is putting a strong emphasis on price and we have to respond to that," he added. "But we musn't get sucked into a spiral of low prices."
Campbell also outlined Spar's strategy for its future growth, which is focussed heavily on expansion into the Middle East.
With the population of Asia predicted to reach 5 billion by 2050, Campbell said that expansion into this market was vital to Spar's long-term strategy.