50% off bargain Britain

Tesco sparked the unprecedented sales bonanza by announcing it was halving the price of 1,000 items, including food, drink, gifts and toys, until Christmas.

House of Fraser followed suit, while Woolworths stores were stripped bare in a few hours as it sold off stock at half price before the company goes bust.

Debenhams and Marks & Spencer have discounts of 20 per cent and household names such as Currys, Argos, Boots, Sainsbury’s and even Waitrose are also offering large discounts of up to 75 per cent this weekend.

One analyst said the sales frenzy reflected the dire situation British retailers are in.

“Desperate times call for desperate measures" he said.

Stephen Robertson, director general of the British Retail Consortium, said: “I have never seen anything quite like this in terms of the levels of deals, offers and promotions.

Woolies and MFI have already fallen victim to the economic downturn. And Mr Robertson predicted more retailers could soon follow. “I fear that in the first quarter of next year we may see a number of retailers going into administration,” he warned. Initial figures show the number of customers was down 6.2 per cent between Monday and Wednesday this week compared with the same time last year.

This is disastrous for many shops which rely on the pre-Christmas trade.

Some shoppers may be holding out to buy presents as late as possible in the hope of prices falling further. But Mr Robertson warned: “They need to be aware that stores may go out of stock of things they were hoping to buy on Christmas Eve. Men take note.”

Ernst & Young retail director Jason Gordon said: “In general the level of discounting and promotional activity is deeper and bigger than we have seen historically. We seem to be in a stand-off. Consumers are clearly waiting for the best possible offers.”

Prices are set to plunge even lower as retailers try to shift stock in the January sales. Jonathan De Mello, director of retail consultancy Experian, said: “It is brilliant for shoppers because they can go out and get a bargain.

“Because they feel they can get better bargains they are going to force the retailers to discount even further. It is like a vicious circle for the retailers but it is great for the shopper.”

This time last year 20 per cent of grocery store products were sold on cut-price promotion. Today the scale of promotions is nearly double that amount.

Tesco is cutting prices on around 1,000 products ranging from beef to perfume and bicycles. Its half-price deals include a quad bike reduced from £80 to £32, Hannah Montana assorted dolls down to £5.18 and beef roasting joints reduced to £4.48 a kilo. Rivals Morrisons, Sainsbury’s and Asda all have big discounts too. But it is not only food stores slashing prices.

The December sales include all types of shops, from fashion and shoe stores to electrical and music chains.

Argos deals include up to 60 per cent off toys and up to 75 per cent off Christmas decorations, trees and lights.

Sainsbury’s is cutting 25 per cent off some prices in its TU clothing and Champney’s health and beauty ranges. It has lots of food offers including half price on meat joints.

Even upmarket chain Waitrose is not immune from the downturn and has boosted its promotions across selected food and drink.

There is one good sign for retailers, however. The most favourable exchange rate in more than six years seems to have prompted Americans to start shopping in London again.

Anne Pitcher, Selfridges’ buying and merchandising director, said: “We are delighted about the high number of American customers visiting our store. They’ve been shopping with us all year, but with the recent fall in the value of sterling we have noticed much more willingness on their part to spend money on high-value items in our fashion, accessories and jewellery departments.”

Paul Charles, director of communications for Virgin Atlantic, said: “We’ve seen a growing interest in recent weeks in our daily flights from 10 US destinations.

“The stronger dollar means visitors from America are getting more bang for their buck. They are taking advantage of a better value London.”