Sainsbury's starts to sell TU clothing range online, as part of plans to turn fashion into £1bn business

By Neil Craven for The Mail on Sunday

Updated: 11:47 EDT, 31 August 2014

Sainsbury's began selling its clothing range on the internet this weekend as part of a plan to turn its fashion lines into a £1billion business.

The supermarket’s fashion label TU will initially be available only to some customers in the Midlands, but a UK-wide launch is expected next year.

Sainsbury’s non-food director James Brown said the brand has received significant investment and the number of in-house designers has been doubled to about 30.

Sainsbury's began selling its clothing range on the internet this weekend as part of a plan to turn its fashion lines into a £1billion business

Sainsbury’s is revealing its strategy as troubled rival supermarket Tesco announced its third profit warning this year and also revealed that the interim dividend would be slashed by 75 per cent.

Tesco’s new chief executive Dave Lewis will begin work tomorrow after his start date was brought forward a month.

Sainsbury’s TU clothing range is benefiting from an overhaul in stores as the chain plots to snatch market share from supermarket rivals as well as from specialist clothing stores.

Sainsbury’s is adding another 225,000 sq ft of space for fashion this financial year and the refurbishment of 150 clothing sections will be completed by Christmas. But a price war on food threatens to escalate.

Sainsbury's non-food director James Brown said the brand has received significant investment and the number of in-house designers has been doubled to about 30

Tesco and Morrisons have focused on cutting prices in attempt to combat the growth of German discounters Aldi and Lidl.

Tesco shares declined 7 per cent after Friday’s news which included a warning that capital expenditure would be cut. This was read by many as a sign that it was lining up cash for further price cuts.

Sainsbury’s share price fell 4 per cent and Morrisons dropped 5 per cent.