Supermarket rivals lock in cheap bread

Cheap loaves of bread are here to stay -- at least for the foreseeable future, the country's major supermarkets have confirmed.

Countdown, New World and Pak'nSave say they have noticed increased demand for bread as a result of the lower prices.

A price war, which began last month between the supermarket rivals, saw the price of bread drop to just $1.

Countdown is owned by Progressive Enterprises, while New World and Pak'nSave supermarkets are owned by Foodstuffs.

"We increased production to ensure we didn't run out, and throughout the country strong demand continues," Countdown managing director Dave Chambers said.

The cheap bread was not a limited time 'loss leader' for Countdown, but rather the 'new everyday price on this popular bread range,' he said.

Countdown's "Price Lockdown" promotion for bread resulted in the chain's Homebrand white and wheatmeal bread drop from $1.48 to $1.00 on July 18, with a customer limit of four loaves per shop.

"As with any product in our stores, we always look for opportunities and ways we can bring a lower price to the shelf," Mr Chambers said.

Foodstuffs' marketing general manager, Steve Bayliss said it has been a challenging year for Countdown and 'reaching for the price lever aggressively' to regain lost ground was not surprising.

While customers are the big winners from the price war on bread, Bayliss says this comes with a warning.

"We don't believe the current pricing is economically sustainable long term and prices will eventually rise," Mr Bayliss told the Herald.

New World's "Price Limits" promotion offers Budget brand 600g loaves of bread also for $1 with a limit of five loaves.

"In a hyper competitive market, where no brand wants to give the competition an inch, we're unlikely to see pricing tensions easing in the near term," he said.

Some critics have labelled the cheap bread promotion as unhealthy.

Tauranga nutritionist Angela Frieswyk told the Bay of Plenty Times she recommended most clients stay away from bread, especially white bread, as much as possible.

"I would prefer to see places like supermarkets discount veges," she said.

- Daniel Lynch of the New Zealand Herald

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