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Sainsbury's joins supermarket price war

Sainsbury's has pledged to match thousands of prices at rivals Tesco and Asda as the price war between the UK's leading supermarkets intensifies.

The "Brand Match" promotion starts on Wednesday, October 12 and comes two weeks after Tesco launched a £500 million "Big Price Drop" that cut the prices on 3,000 lines including milk, bread, fruit and vegetables.

Sainsbury's has installed a price comparison system at tills across its branches that will instantly calculate the price of branded goods in a customer's shopping basket against the same brands at Asda and Tesco.

If the basket is cheaper at its rivals, Sainsbury's customers will get a coupon for the difference that is valid for two weeks. The minimum spend is £20 and the promotion will not apply to online shopping.

Competition for shoppers' cash has become increasingly fierce as economic uncertainty, wage freezes and high inflation have squeezed consumer income.

Last week, Tesco posted its worst quarterly sales performance for two decades and described the conditions as the toughest for a generation.

Its sales fell by 0.9% in the three months to August 27 excluding VAT, petrol and new stores.

Sainsbury's did better as same-store sales including VAT increased by 1.9% in the 16 weeks to October 1, but chief executive Justin King also described conditions as "tough".

The Brand Match promotion, which compares the prices of 13,000 branded goods, has already been trialled in Northern Ireland, where it was "overwhelmingly well-received", Sainsbury's said.

Mike Coupe, Sainsbury's group commercial director, added: "We have been listening to feedback from consumers and they tell us that stretched budgets mean they are shopping around to get the best deals on the brands they love."

Tesco responded in Northern Ireland by accepting the Sainsbury's coupons in its own stores. It is not known if it will do the same following the full UK roll-out by its rival.