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Tesco has taken its first steps toward creating an own-label market

in electronics goods by commissioning Amstrad to produce CD players

specially for its stores.

The Amstrad deal mirrors the way supermarkets arrange suppliers for

their own-label food ranges, and serves to underline the importance

Tesco is now placing on its non-food lines.

The players will be sold for a discount retail price of pounds 50 under

Amstrad’s Fidelity brand. A spokesman at Tesco said it considered using

the Tesco brand name but research showed that the name would not

transfer well.

The tie-up with Amstrad is set to infuriate electrical retailers Dixons

and Comet.

A Tesco spokesman said: ’There is not that much competition in the

electrical goods market, and as a result, electrical retailers charge

higher margins. We have many companies coming to us to sell their goods

as we can offer them at cheaper prices.’

Despite last week’s EC ruling, UK supermarkets continue to sell designer

goods bought from the ’grey market’ at knock-down prices. This week Asda

will be selling Clarins skin care products at 20% below the retail

price.

The EC ruling stated that it is now illegal for UK retailers to sell

designer goods bought from the ’grey market’ outside Europe. Asda is

refusing to say where the Clarins goods have been sourced.