Image: © Cathy Kates / Imgcop

Asda and Sainsbury’s say they’ll cut prices by 10%, and people are sceptical

The main question is: who exactly is going to take the hit?

MPs were having a bit of an argument with the chief execs of Asda and Sainsbury's yesterday over whether customers really were going to be better off as a result of the merger.

What it means: The whole 'Asdabury''s thing had people a bit suspicious about the fact that this new mega-market would basically control 31% of the supermarket industry.

But both chains say this'll be good for customers: they claim they can cut the prices of everyday products by 10%.

Yesterday, MPs grilled them on how exactly those savings would be made – and it all got a bit heated, with everyone throwing around words like "Mickey Mouse Figures" and "nursery rhymes" , and "Don't come here and talk baloney – I can add up."

The thing is, the chief execs wouldn't say where those savings come from – they claimed it's 'confidential and sensitive' information, presumably because they don't want someone copying their business model.

But it highlights how something that looks great to one person in an economic exchange – a drop in prices – always has another side to it... and if we don't know what that other side is, it's hard to make a judgement call on whether we think it's justifiable.

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