Sainsbury's takes the fight to Tesco with planned January sale

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The Independent Online

J Sainsbury, the former UK number one supermarket now being overhauled by its chief executive, Justin King, is to take on the current market leader, Tesco, by launching a January sale.

The chain has had sales in the past. But these were impromptu events used to shift leftover stock. Its trading director, Mike Coupe, said this year's event had been planned several months in advance.

"We're competing with all the major rivals in this area," he said. "January is just another moment in the retail calendar that we can exploit. There's a natural rhythm in the way customers behave, and the more we respond to that, the better. But we can't do this sort of thing without planning."

The January sale, a staple for most retailers, will focus on non-food items including televisions, kitchenware and fitness equipment. There will be up to 50 per cent off, though Mr Coupe declined to say how much the sale would cost the group.

Once the UK's leading supermarket, Sainsbury's slid to the number three slot after shoppers, frustrated with erratic pricing and product availability, deserted in their droves.

Another issue was non-food items, with rivals Tesco and Asda offering a far wider range at a greater number of stores.

As a result, Mr King has had to make non-food a central part of his turnaround strategy for the chain. He is targeting £700m in additional sales just from this segment over three years.

As well as the January sale, the chain is widening its range of products and rolling the format out across more shops. It has also opened new sourcing offices in Poland and the Far East.

However, Mr Coupe stressed that the group was not seeking to compete directly with rivals such as Tesco throughout the year. "We're planning a big sale post Christmas - electricals, duvets, all the stuff you would expect to see in a January sale. But we're not setting out to ape Tesco. Our strategy is about being price competitive, not a price leader."

The chain suffered a tough Christmas last year, with underlying sales down 1.2 per cent, excluding petrol, in the 12 weeks to New Year's Day. At the time, Mr King said he was encouraged that the performance had not been worse, but conceded that the chain had failed to attract new customers over the period.

Mr Coupe said last Christmas was "about surviving and getting through it" but that he was more confident for this year. The group has cut prices and improved availability throughout the year, which has helped lift sales. Mr Coupe said he expected strong demand for fresh food and ranges such as Taste the Difference over the festive period.

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