Morrisons hiked prices by almost a fifth in the past year – more than any other major grocer and double the rise at Sainsbury’s.
A shopping basket at the Bradford-based supermarket cost £75 this month, an 18 per cent increase from a year earlier, according to The Grocer magazine.
The findings vindicate critics of Morrisons’ sale – to US private equity barons two years ago – who warned it would lead to higher prices.
The same basket of 33 everyday products cost £70 at Sainsbury’s, having increased 9 per cent from a year earlier. Tesco’s basket cost £74, a 13 per cent increase, while Asda was the cheapest at £67.15, up 11 per cent.
Among Morrisons’ price hikes were on tubs of New Covent Garden leek and potato soup, which are now more than twice as costly as a year ago, at £2.20 for 560g. It also raised the price of 750g boxes of Jordans granola by 80 per cent to £3.59, and Filippo Berrio olive oil by 50 per cent to £5.99.
Price hike: A shopping basket at Morrisons cost £75 this month, an 18 per cent increase from a year earlier
The industry average overall price rise for a basket of shopping is 13.2 per cent. It is the latest sign Morrisons has been jacking up prices quicker than rivals since falling into private equity hands in 2021.
The chain was bought by US private equity firm Clayton, Dubilier & Rice (CD&R) in a debt-fuelled deal spearheaded by former Tesco chief Sir Terry Leahy. Analysts say its huge borrowings at a time of rising interest rates have left it with less scope to keep prices low.
As a result it has haemorr-haged shoppers to Tesco, Sainsbury’s and Asda. Morrisons has lost a chunk of its market share to Aldi and Lidl, with the former stealing its spot in the ‘Big Four’ of British grocers last year.
Credit agency Moody’s downgraded Morrisons’ rating last week. Accounting professor and Labour peer Lord Sikka said the grocer is suffering from ‘the curse of private equity’. He said CD&R financiers have followed ‘the usual model’ of loading a company up with debt and trying to maximise short-term profits.
Sikka also pointed to ‘sale and leaseback’ activity, a factor that contributed to the demise of Debenhams in 2020. He asked: ‘Will history repeat itself, and will Morrisons go the same way as Debenhams, Maplin, Toys R Us and others?’
Morrisons said it has improved this year on price compared with rivals, cutting the cost of many products.
#fiveDealsWidget .dealItemTitle#mobile {display:none} #fiveDealsWidget {display:block; float:left; clear:both; max-width:636px; margin:0; padding:0; line-height:120%; font-size:12px} #fiveDealsWidget div, #fiveDealsWidget a {margin:0; padding:0; line-height:120%; text-decoration: none; font-family:Arial, Helvetica ,sans-serif} #fiveDealsWidget .widgetTitleBox {display:block; float:left; width:100%; background-color:#af1e1e; } #fiveDealsWidget .widgetTitle {color:#fff; text-transform: uppercase; font-size:18px; font-weight:bold; margin:6px 10px 4px 10px; } #fiveDealsWidget a.dealItem {float:left; display:block; width:124px; margin-right:4px; margin-top:5px; background-color: #e3e3e3; min-height:200px;} #fiveDealsWidget a.dealItem#last {margin-right:0} #fiveDealsWidget .dealItemTitle {display:block; margin:10px 5px; color:#000; font-weight:bold} #fiveDealsWidget .dealItemImage, #fiveDealsWidget .dealItemImage img {float:left; display:block; margin:0; padding:0} #fiveDealsWidget .dealItemImage {border:1px solid #ccc} #fiveDealsWidget .dealItemImage img {width:100%; height:auto} #fiveDealsWidget .dealItemdesc {float:left; display:block; color:#004db3; font-weight:bold; margin:5px;} #fiveDealsWidget .dealItemRate {float:left; display:block; color:#000; margin:5px} #fiveDealsWidget .dealFooter {display:block; float:left; width:100%; margin-top:5px; background-color:#e3e3e3 } #fiveDealsWidget .footerText {font-size:10px; margin:10px 10px 10px 10px;} @media (max-width: 635px) { #fiveDealsWidget a.dealItem {width:19%; margin-right:1%} #fiveDealsWidget a.dealItem#last {width:20%} } @media (max-width: 560px) { #fiveDealsWidget #desktop {display:none;} #fiveDealsWidget #mobile {display:block!important} #fiveDealsWidget a.dealItem {background-color: #fff; height:auto; min-height:auto} #fiveDealsWidget a.dealItem {border-bottom:1px solid #ececec; margin-bottom:5px; padding-bottom:10px} #fiveDealsWidget a.dealItem#last {border-bottom:0px solid #ececec; margin-bottom:5px; padding-bottom:0px} #fiveDealsWidget a.dealItem, #fiveDealsWidget a.dealItem#last {width:100%} #fiveDealsWidget .dealItemContent, #fiveDealsWidget .dealItemImage {float:left; display:inline-block} #fiveDealsWidget .dealItemImage {width:35%; margin-right:1%} #fiveDealsWidget .dealItemContent {width:63%} #fiveDealsWidget .dealItemTitle {margin: 0px 5px 5px; font-size:16px} #fiveDealsWidget .dealItemContent .dealItemdesc, #fiveDealsWidget .dealItemContent .dealItemRate {clear:both} }
