5 November 2005
DailyRecord
Prices slashed in bid to beat slump
By Paula Murray
A CHRISTMAS price war began yesterday when Woolworths cut gift prices by 10 per cent in an unprecedented move.
Supermarket giant Asda are also slashing the price of toys and games in a pre-festive season move.
The move by two of the biggest names in shopping is a sign that the high street is suffering dismal pre-Christmas sales.
Woolworths are staging a tactical two-day price-cutting promotion across stores this weekend in an effort to grab an early share of this crucial market.
They claim prices of toys have already been reduced by25per cent and will be cut by a further 10 per cent .
They are spending £20million in an advertising blitz to promote the sales.
The move is seen by some industry insiders as a desperate measure to see off a potential takeover After 10 months of disappointing sales, Woolworths are determined to make Christmaswork this year.
It is understood private equity firms will pounce on the group early next year if they underperform.
Stephen Robertson, Woolworths marketing director, said: "We've created the most integrated advertising campaign in Woolworths' history."
But they face tough competition, despite cutting the price of gifts such as Action Man,Lego and board games.
Asda have slashed the price of 77 toys as the battle for Christmas sales with high street stores is stepped up.
Asda said the price drops which were introduced this week would last for two weeks. The supermarket chain have increased their range of toys in a challenge to traditional outlets.
Over the past three months, Woolworths' shares have fallen by more than 11 per cent. On Thursday Tesco sparked a CD price war by cutting the cost of some chart titles as low as £7.17. Other high street giants agreed competition for customers was going to be fierce this Christmas.
A spokeswoman for BhS said: "There is no doubt that it is going to be a difficult trading period this Christmas. We have to be aware of what is going on in the market place and we will respond accordingly to the current climate."
#ASDA also sparked a petrol price war yesterday by knocking 2p off petrol - almost 6p below the national average
