The company, which also owns Argos, said its plans included an overhaul of its supermarket offering that would see general merchandise and clothing space reduced across many of its main stores to make way for more groceries.

The decision reflects recent sales trends at the chain, which trails only Tesco in terms of grocery market share.

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The new £1bn savings target would include savings from reduced deliveries, waste and replenishment costs and an
increased use of automation.

When contacted by Sky News on the prospects for jobs, the company, which has around 150,000 staff, was unable to give any update on the implications for employment at this stage.

A Sainsbury's spokesperson said: "Looking after our people will always be a key priority for us - as demonstrated by our recent investment of £200m in providing an industry leading pay rise."

Other elements of the new strategy, dubbed "Next Level Sainsbury's", included further investment in new convenience stores, its Nectar loyalty scheme and bolstering customer satisfaction.

The grocery space has been fiercely competitive since the financial crisis of 2008, with the growth of discounters Aldi and Lidl forcing the more established chains to invest more heavily in value to protect their respective market shares.

Sainsbury's saw its share price rise by 40% last year.

Investors, however, were seemingly less than impressed with the company's new planned commitments, as the stock was off by almost 4% by mid-morning.

Sainsbury's said it would pursue a progressive dividend policy from the start of its 2024/25 financial year and commence a £200m share buyback programme over the period.

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But it also confirmed an increase in capital expenditure predictions and the target for free cash flow was not raised.

Chief executive Simon Roberts said: "Our Food First strategy has delivered on its promise over the last three years, making Sainsbury's a stronger business with a much sharper position on value and a major refocus on our innovation.

"Customers have recognised the progress we've made, as our market share gains have shown.

"Our Next Level Sainsbury's strategy is about giving customers more of what they come to Sainsbury's for - outstanding value, unbeatable quality food and great service. Thanks to our scale, our brand and our people, we are in a unique position to deliver for customers across Sainsburys, Argos and Nectar."