Discount supermarket Lidl is looking to open a store in Eastfield, The Scarborough News understands.
The German retailer is targeting the Scarborough Business Park for a store to be opened next year.
The company confirmed it was looking to open locally but refused to confirm it had identified a location.
Should the move materialise then it would put the supermarket in direct competition with Morrisons, with which it has been having a recent advertising battle in the national press after the Bradford-based company announced it would start price-matching with Lidl and Aldi.
Lidl then produced a tongue-in-cheek advert mocking Morrisons for the complicated way it had gone about trying to compete.
One local source, who did not wish to be named, said: “It has become a bit of an open secret in Eastfield that Lidl is looking to move out here.
“We know it has been looking at sites round here and the indications are that if it finds one suitable enough then it feels it could open quite quickly.”
A store on the business park would also pit the supermarket in competition with Scarborough’s Proudfoot chain, which has a store in High Street.
A spokesman for Lidl told The Scarborough News: “We are currently exploring opportunities in the Scarborough area, however, we do not have any particular sites in mind at this stage.”
The company was linked with a bid for the Dean Road depot site following Tesco’s pullout of a £10 million store in December last year.
However, it now seems it has its sights set firmly on Eastfield and could be open sometime in the new year.
Since launching in England in 1994, Lidl has grown consistently and today has more than 580 stores across the United Kingdom.
The popularity of discount stores like Lidl and Aldi has grown considerably in recent years as people move away from shopping at more expensive supermarkets.