Bi-Lo is lowering prices by up to 50 percent on more than 400 frequently purchased items like chicken, bread, sugar and cheese as part of a new pricing strategy.
Bi-Lo’s price slashing, which took effect Wednesday, comes as low-cost grocers step up their fight to win over price-sensitive shoppers. The initiative is another way the Charlotte region’s No. 5 grocer by market share is working to set itself apart.
Ian McLeod, president and chief executive officer of Bi-Lo parent Southeastern Grocers, describes the price cuts as a “long-term change” in the grocer’s position. In other words, prices are coming down and they’re staying down.
“We’re talking about staple items ... these are items being bought week in and week out,” McLeod said. “The price reductions that are coming through are pretty significant.”
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Under the so-called “Down Down” campaign, the new pricing means Sanderson Farms chicken breast that was $4 a pound is now $2.50 a pound, for example – a savings of 38 percent. Southern Home vegetable oil that was $3.18 is now $2.30 – a savings of 28 percent.
The supermarket chain’s most recent round of price reductions follows a similar move this fall when the prices of nearly 3,000 products were slashed. The Observer had reported that prices of about 1,000 items were to be cut — McLeod clarified that different flavors and sizes of the same type of product were counted in the 3,000.
Customers responded well to this fall’s price reductions, and McLeod said the latest price lowering will put Bi-Lo into a “very competitive position.”
“If competitors want to follow those prices and match them ... it’s going to be even better for the customers in the Carolinas,” McLeod said.
Grocery competition in the Charlotte region, especially among discount grocers, has been heating up recently. Newer chains like Lidl have said they plan to grow their footprints here. Walmart has rapidly been expanding its Neighborhood Market concept. And Food Lion recently started lowering prices on thousands of items as part of a new strategy.
McLeod said Bi-Lo stands out among its competitors because of its large product selection (around 25,000-30,000 items in the store).
Bi-Lo is able to pass the savings to customers thanks to company-wide “behind-the-scenes” efficiency improvement, McLeod said.
That includes Bi-Lo’s supply chain, “whether it be product coming into the store, how we merchandise it, how we improve our productivity, how we manage our stock, how we look at our overall markdowns, manage our short-life products and improve our quality,” McLeod said. Store closures haven’t been part of the efficiency drive, he added.
Bi-Lo operates 23 stores within 25 miles of Charlotte.