SIR PHILIP Green is taking on the supermarkets this week, as BHS launches its first food outlet.
Arcadia, the group owned by the retail tycoon, confirmed over the weekend that BHS will be opening its first trial food space in its Staines store on Thursday, with Warrington to follow the next week.
A spokesperson told City A.M. that the retail chain is aiming “to be competitive” within the convenience food sector and that the trial is the start of bigger plans.
Nearly 150 BHS stores have permission to sell food, and many of the stores already have cafes.
The new food outlets will just sell other brands at the moment, rather than BHS-branded products.
Green said in November that he was considering the move into the convenience food sector, which is now worth around £160bn a year.
The market will be waiting to see if BHS can gain any substantial market share at a highly challenging time for grocers, who are embroiled in a high-octane price war.
Morrisons said earlier this month that it plans to invest £1bn in slashing prices over the next three years, as it battles to win back customers from growing budget chains Aldi and Lidl. The German discount supermarkets have managed to upgrade their image and appeal to the cash-strapped middle classes.
Morrisons’ announcement wiped £2.6bn off the combined value of Britain’s major grocers, who have also unveiled price cuts.
Earlier this month, Tesco followed Asda and reduced the price of four pints of milk from £1.39 to £1, which was quickly followed by its rivals.
Arcadia, which also owns the Topshop, Topman, Burton, Dorothy Perkins, Miss Selfridge, Wallis and Evans brands, saw its pre-tax profit rise from £104m to £481m in the year to 31 August 2013.