Why Tesco's struggles are great news for shoppers

Tesco slash prices

Falling sales at Britain's biggest supermarket Tesco could mean good news for consumers as a price war has kicked off with rivals.

It followed Asda in announcing a raft of price cuts on some of its best-known products, giving hope to customers that there could be big savings across the board.

The news follows the price of oil falling to its lowest for five years, and Sainsbury's chief executive Mike Coupe said earlier this week that petrol could fall below the £1 a litre mark, chased down by supermarket competitors.

Save money at Tesco with great vouchers from AOL Deals

Tesco announced its price cuts ahead of releasing disappointing Christmas sales figures, claiming the move meant average savings of 25% on 380 items including brands such as Hovis, Coca-Cola, Marmite and Tetley.

Chief customer officer Jill Easterbrook said: "We know that customers want to see changes in the way we serve them. One of the biggest things they've been saying is that they want prices which are simple, consistent and low.
"The changes we're making today are a first step in that direction, and we've focused on many of the favourite brands customers choose every day."

Asda this week cut the prices of 2,500 "essentials" such as fruit and vegetables, cereal, nappies, toilet rolls, milk, meat, eggs and fish.

Sainsbury's also announced further reductions as part of a £150 million price-cutting plan disclosed in November.

Britain's big four supermarkets are fighting desperately over the dwindling middle market which is being squeezed by high-end Waitrose sales and the huge popularity of budget operators Lidl and Aldi.

Cut the cost of groceries
See Gallery
Why Tesco's struggles are great news for shoppers
Shopping starts long before you leave the house. Check the fridge, freezer and cupboards, then draw up a list of all the meals you plan to make and eat during the week (making sure you include any leftover perishables in those meals). That'll tell you exactly what you need to buy. This isn't everyone's favourite activity, but you'll be astonished how much less you buy - and crucially how much less you end up throwing away. This process typically cuts 5% off your grocery bill.
Supermarkets are entirely designed to make you do this, with flashy displays at the door, and discounts heaped high on the end of each aisle (they're put here because they know it takes a while to turn your trolley so they have longer to catch your eye). There will be new products and special offers which will sorely tempt you, but everything extra you buy will mean you either eat more or have more to throw away more at the end of the week.
There are three levels of products: the branded ones (including the premium supermarket ranges), the own-brands, and the own-brand value range. The best way to shift down is to move down one rung of the ladder on everything you buy - so if you usually buy branded baked beans go for own-brand, and if you usually buy own-brand, go for the value own-brand.
Most people choose a supermarket out of either convenience or habit. However, switching to a cheaper supermarket could be the easiest way to save. No one supermarket is cheaper for everything across the board. However, as a very rough rule of thumb Asda is the cheapest of the big players - it regularly wins awards for this (and did so last year), and it also has a pledge, which promises that the items you pick that are part of its scheme will be 10% cheaper than elsewhere or you can claim the difference. If you are willing to go beyond the big players, the discounters are substantially cheaper, so it's worth trying Aldi or Lidl to see what you could save.
Of course, no supermarket is cheaper for absolutely everything. And in some instances the supermarket is not the cheapest place for your food - local markets for example can offer much cheaper fruit and vegetables.

You'll need to get to know your local independents, but the best way of being sure of getting a good deal at the supermarkets is to do your research before you go. Mysupermarket.co.uk lets you compare prices for Tesco, Morrisons, Asda, Sainsbury's, Waitrose, Aldi and Ocado.

You'll need to put your shopping list into the site, which is a bit time-consuming the first time you do it but gets quicker once you have saved your favourites. It will tell you the cheapest places for your shopping - leaving you to choose whether to make more than one trip or to go with the supermarket that is cheapest for the most of your items.
There's definitely a right and wrong way to do this. The right way is to search for vouchers, coupons and deals for things you already need to buy. Alternatively, you can keep an eye out for BOGOF deals on things you regularly use (as long as they aren't perishable), and stock up on them. This can be useful for things like toiletries - just don't be tempted to switch to a more expensive brand in order to do this unless you have checked that the deal constitutes a saving from your usual brand at its usual price.
Supermarket deals are not simple to compare, so you could easily find yourself trying to work out if 350ml of something at 58p is cheaper or more expensive than 250ml of something at 46p. For most people this isn't the kind of maths that's easy to do on the fly. The only solution is to take a calculator and work it out - unless you want to focus on building world-class mental arithmetic skills.
Your careful list-making will not always go to plan, so if you end up eating something different one night, think about what you will do with the food you had planned to eat. Can you cook it and freeze it? Can you substitute it for another meal? Likewise with the leftovers, have you factored these into your eating plan? Or will you need to freeze it for next week?
This is classic advice for a reason. Research has shown that if we eat before we go we buy 18% less food. So have a sandwich and shave almost 20% off your bill.
If you are good at managing your credit cards, then shopping using a cashback card can be a great way to earn back money on your shopping. It's worth emphasising that in order for this to be a money-spinner you'll need to pay it off in full and on time every month. However, this is something that disciplined shoppers should definitely consider.

More on AOL Money

Search for vouchers across Tesco's range

Tesco 'land bank' could house a small city

Sainsbury's criticised over war memorial plan

Can Tesco Recover from Worst Ever Year?
Read Full Story