This marks the start of a big, but belated push by Tesco into the brown goods market - televisions, videos and audio equipment. Asda and Sainsbury, through its SavaCentres, already sell a range of brown goods. Safeway is also known to be talking to suppliers about introducing electrical goods.
Analysts said that while Tesco's move, which represents an escalation in the war between the supermarket groups, was highly risky for the company it could damage the profits of the high street electrical shops like Dixons and Comet, owned by Kingfisher.
"This is high risk for Tesco. Electrical goods is such a nasty price- competitive market. People will be asking what Tesco is doing in such a tough area. Most of the retailers don't make any money on these products, just on the warranties," said one leading retail analyst who declined to be named. "If it is true, it is certainly very negative for Dixons and Kingfisher. These companies will have to match Tesco's prices and it will hit profitability," the analyst added.
Tesco is already trialling the sale of a limited number of television in its largest UK store, the Pitsea hypermarket near Basildon in Essex. The group brought in 24 Amstrad 14-inch televisions into the store on 10 June for a cut price of pounds 119 which "sold out in three hours", according to a salesperson at the store.
Yesterday Tesco's Pitsea shop put 16 flat screen, 28-inch Bush televisions, made by electrical group Alba, on the shelves selling for pounds 299.99. "They've only been here for a few hours and already most are gone."
Though a spokesman for Tesco said it had "no plans to sell on an ongoing basis in any other store apart from Pitsea", sources within the company confirmed there would be a roll-out of televisions and possibly videos into the group's 297 superstores within the next two months. "We expect to be briefed near the end of the week and go nationwide in a couple of months. All our major superstores will be selling televisions," said one insider.
Over the last few years supermarkets have been gradually expanding beyond their core food and drink product range to use floor space as effectively as possible. Sainsbury has announced a deal with healthcare group Sinclair Montrose to open in-store doctor surgeries. Asda linked up with George Davies, ousted chairman of Next, to sell clothes.Reuse content