A round-up of supermarket news and gossip
NEW food tests, which could bolster consumer confidence in premium-priced products, have been used to discover that Britain’s biggest supermarket chain has been mis-selling ordinary chickens as “corn fed”. Government scientists found that birds from Tesco’s Finest range had not consumed enough maize to justify being labeled as corn-fed in tests conducted for the The Times. Tesco sells free-range corn-fed chicken for £3.58/kg. Ordinary fresh whole chickens sell for £1.95/kg.

Justin King the chief executive of J Sainsbury has criticised rival retailers for spouting “hot air” about environmental master plans that make unrealistic promises. He states retailers such as Wal-Mart and Marks and Spencer have tried to key into shoppers’ interest in green issues and ethical trade by announcing plans to cut carbon emissions, recycle waste and treat suppliers more fairly. Mr King said:”It is not about making big announcements on things that might happen in five years’ time if the technology is available. He argues that many of the announcements are rivals playing “catch up” to work that Sainsbury’s has been doing for years.

Asda has been fined £80,000 for selling out-of-date food, Trading standards officers who visited stores in Newport and Cwmbran bought 59 items that were out of date, Abergavenny magistrates heard.

The troubled grocery chain Kwik Save is facing a new cash crisis, according to insiders. The company has received a £5m rescue package but reports state that Arla Foods stopped delivering milk to the company, citing ”payment problems”. Unconfirmed reports suggest Kwik Save’s bread supplies have also been stopped at some stores. Kwik Save has declared numerous redundancies. At the time of going to press, KPMG was fighting to rescue Kwik-Save, but the men on the ground see it as a lost cause.

Sales of fresh fruit and vegetables increased by almost 8% last year, the highest annual rise for 20 years. The figures, in the Government’s family food survey, show that official messages encouraging healthy eating appear to be getting through to consumers. People aged under 30 spend an average of 42% of their food budget on eating out. 80% of the nation is eating four or more pieces of fruit or vegetables a day. Sir Ken Morrison said that he was “ready to give up” as he led what is likely to be his last annual meeting as chairman. A short list of replacements is in place. The same company saw its shares dip by 2.1% over a 15-week period.

Marks and Spencer will announce plans for its first eco factories, as the high street retailer prepares to draw thousands of suppliers into its green agenda. Three factories, one in Sri Lanka and two in Wales, will harness the latest renewable-energy and recycling technology to act as a blueprint for other firms. Staff at Marks and Spencer are tipped to share a £90m bonus pot after a bumper year.

Booker, the cash-and-carry group, is set to return to the public market after agreeing a reverse takeover by Blueheath Holdings, an AIM minnow. The speculation that Private Equity Groups are circling the Morrison's group intensifies. The speculation is that the company could soon receive a £9bn takeover approach.

Sir Philip Hamilton, the chairman of Sainsbury has hinted that he may increase the pay of chief executive Justin King following the fourfold increase in pre-tax profits.

Sir Terry Leahy, the chief executive of Tesco is in line for a potential £11.5m share bonus under a scheme to reward him for developing the supermarket’s international business. Tesco has lost the Bourneville battle. Teetotallers have won the fight to keep alcohol away from the historic Bourneville Estate in Birmingham. The area has been “dry” since it was set up by George Cadbury, the Quaker chocolate magnate, in the 1890’s.

Sainsbury is to shut down its on-line music and CD store after failing to make an impression.

GEMINI