Overview
- The Bank of England says use of market‑responsive pricing tools is set to grow, with its latest business survey finding about one in three firms plan to adopt them within a year.
- Dynamic pricing uses algorithms, including AI, and electronic shelf labels to change prices in response to data such as demand, capacity or competitors’ prices.
- Major UK grocers are installing electronic shelf labels: Co‑op has them in 700+ stores with plans for 2,300 this year, Morrisons is rolling out to all 497 supermarkets, Waitrose plans a full rollout, Asda is fitting about 250 Express stores, and Tesco, Sainsbury’s and some Lidl sites are testing them.
- Supermarkets say the systems are for efficiency, not surge pricing, with Morrisons citing label replacement savings and Waitrose stating it has no plans for dynamic prices, while the British Retail Consortium says stores do not use and do not plan to use surge pricing.
- Deputy governor Clare Lombardelli warns lower “menu costs” mean prices can change far more often, which could skew how people perceive inflation, even as dynamic pricing is already routine in sectors like online retail, airlines and hotels.