CUT-price supermarket chain Netto will create nearly 200 jobs in the region in the next two years as it begins an expansion programme.

As the Danish chain opened its store in Darlington yesterday, UK managing director Claus Waedeled said he would open at least five more in the next two years in the Newcastle area, with others planned for Stockton, Teessside, and Northallerton, in North Yorkshire.

He said: "I have said before, I think there is room for 1,000 stores in the UK and at the moment we have 136.

"We are planning to open between 20 and 25 stores a year all over the UK until we reach our target."

Mr Waedeled admitted that a weakness of the chain was allowing people to believe that the quality of its food was not as good as mainstream supermarkets.

He said: "It is good-quality - it is just cheap because we cut our overheads.

"We will be looking at launching a campaign soon to try to address people's attitudes about Netto."

The no-frills retailer has invested about £2m in the Darlington store, creating 25 jobs.

The shop, in Neasham Road, is Netto's second in the town.

Mr Waedeled said he planned to continue with the strategy of cutting overheads and buying household brand names in bulk to cut costs.

Netto is a subsidiary of Dansk Supermarket Group and opened its first UK store in December 1990.

It employs 2,500 staff across the country. Mr Waedeled said: "In Denmark, Netto is seen as quite hip and trendy, and it is popular across Europe. We are hoping to improve our image here in the UK too."

He said providing affordable, good quality wine, as well as non-food goods, was also an important part of Netto's ambitions to rival the big supermarkets.

At yesterday's opening in Darlington, one customer started queuing at 5.30am and there were queues throughout the day.

Netto has stores in Stockton, Middlesbrough, Newcastle, Gateshead, Sunderland, Stanley, in County Durham, Northallerton and York.