Morrisons 5% price cuts ‘could have been more’

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CONSUMERS will not reap the full rewards of Morrisons supplying the local market because of the ‘reckless’ new retail tax, according to the Island’s biggest retailer.


Announced at the weekend, a deal has been struck by SandpiperCI with the supermarket giant to sell its goods across all 16 of the Food Hall mini-supermarkets, which will all be rebranded as Morrisons’ Daily stores.

The move, which will create around 100 jobs, will see prices fall by an average five per cent but could have been more, according to SandpiperCI chief executive Tony O’Neill.

The announcement came following the introduction of a new ‘retail’ tax in the Island, which will see retail businesses with annual profits greater than £500,000 taxed on a sliding scale, with those earning over £750,000 taxed at a top rate of 20 per cent.

The new tax was approved in November in the 2018 budget.

Mr O’Neill said that the deal, which will see Waitrose and Heritage goods replaced with Morrisons’ produce alongside local goods, should help secure sizeable price cuts, but even better deals could have been achieved had it not been for the new tax.

‘At this stage we are reasonably confident that we will see prices, on average, reducing by five per cent in our stores,’ he said.

‘But if it wasn’t for this retail tax it would be more. We are doing as much as we can to mitigate the impact of the tax but we believe it was reckless to introduce it at 20 per cent.

‘We believed it was right to introduce it at ten per cent. We have already had to cancel two capital projects because of this.’


He added that SandpiperCI was planning to contact States Members to outline their concerns about the impact of the retail tax.

Mr O’Neill was unable to provide an estimate of how much greater the planned price cuts would have been had it not been for the new retail tax.

But he said that working in partnership with one of the UK’s largest supermarkets would allow his firm’s stores to become more price-competitive.

‘It’s all a question of size these days. We have Waitrose and Iceland in the Island, and Alliance working with Tesco now, which has helped their offering,’ he said.


‘What we are going to have is another top-four UK supermarket coming here, which is bound to bring better value.’

SandpiperCI hopes that the first converted store will open by the second week of May and the firm intends to focus on rolling out the brand in Jersey before moving on to Guernsey.

It hopes to convert all of its stores within 12 months of the first opening and plans to spend a ‘seven figure’ sum on the project.

There are currently 16 Food Halls in Jersey and six in Guernsey. Mr O’Neill could not say at this time which store would be converted first.

It is hoped that the project will create an additional 100 jobs in the Island and SandpiperCI intends to use local contractors to carry out the ‘bulk’ of the conversion work.

James Badger, Morrisons’ wholesale director, said: ‘We are pleased to be announcing a partnership with such a strong franchise partner.

‘SandpiperCI opens the opportunity to bring Morrisons quality and value to customers in the Channel Islands.’

Ian Heath

By Ian Heath


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