Grocery store chain cuts prices

April 23, 2009 3:24:11 PM PDT
A major Chicago area grocery store chain plans to cut the price on thousands of items. Jewel-Osco says it's lowering prices by 20 percent in an effort to improve business during the recession.

Jewel is promoting its latest savings campaign, the big relief price cut is a boon for cash strapped and budget-conscious customers. What remains to be seen is if this will help Jewel fight off rivals Dominick, Costco and Wal-Mart who are all trying to take Jewel customers.

Jewel is slashing prices to bring in customers.

"I just bought an energy drink for a dollar. I think that's pretty cool," said Jeremy Treadwell.

Chicago's largest grocery chain kicked off its big relief price cut campaign that reduces prices up to 20 percent on thousands of items in Jewel-Osco stores.

"We understand this is a difficult economy. We know you want savings. We know you want value. We already have several programs going. This is something additional that we're giving to you," said Karen May, Jewel-Osco.

Discount on items range from household staples to what's served at the dinner table. But for some shoppers, the discounts will never be deep enough.

"Up to 20 percent, okay. No, that ain't what's up. Put it down just a little bit more and it would be a help," said Ken Russell.

The price cuts come as jewel looks to fend off discounters like the aggressively expanding Wal-Mart.

"I think this is more reaction, trying to save their business, because Jewel has seen a lot of business go out its doors and people shifting to places like Wal-Mart and Costco. I think this is a defensive play but it will definitely help the consumers," said David Sterrett, Crain's Chicago Business.

Some say the move will force Jewel's rival number two grocer Dominick's to cut prices or possibly lose customers. But in a statement, a spokesperson for Dominick's says, "This is something we have been doing for a long time. We have already lowered prices on 5,000 of our most shopped items." And a Dominick's spokesperson says that they will continue to do what is best for their customers.

Industry experts say don't expect Wal-Mart to respond in any way simply because their prices are already pretty low. What they are saying this move will do for Wal-Mart is most likely slow the momentum in the marketplace.

Jewel officials say that this latest promotion will be ongoing especially for customers in these tough economic times.


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