How Tesco Plans To 'Put Love Back' Into Chain
The boss of Tesco has vowed to turn around the company's fortunes after the supermarket announced a drop in UK profits.
Chief Executive Philip Clarke has unveiled a plan to "put the love back" into the chain following a 1% dip in full-year UK profts.
It has started a process of overhauling its stores, making them more consumer-friendly, warmer and with a focus on fresh food and customer service.
Branches have been decorated in warmer colours and will even feel warmer - the freezer sections will have sliding doors to stop the aisles being so cold.
The supermarket giant dramatically announced a profit warning in January - its first for 20 years.
Analysts put the bad figures down to neglecting its brand and cutting its prices too far, which resulted in damage to its image.
Tesco's Chief Executive Philip Clarke said: "The consumers have been feeling the pinch, petrol prices have been high, we just took a little bit too much out for customers.
"Late in the summer we corrected our prices, we really pulled down inflation which has been a big problem for everybody, and came out of January feeling what we really need to do is accelerate the pace of improvement of Tesco."
Tesco is also overhauling its website to compete with the likes of Amazon. The plan is to sell products from other companies, via the Tesco website.
The company also wants to extend its "click and collect" service, popular with other retailers, which allows customers to buy products online and collect them at Tesco stores.
Tesco puts much importance on its value for money, but had neglected the look of its shops and was even beaten on price by many competitors.
Natalie Berg from Planet Retail said: "I think Tesco stores have become a little bit tired.
"That comes from years of under investment. They've massively cut back on the number of staff in store and that's had a knock on effect in customer service.
"(But) they have a very strong convenience operation and a very strong online operation and for grocery retailing, these are really the two key growth areas."
Although Tesco is performing below average in the UK, it still has a very strong presence in Asia, particularly South Korea.
That is helping maintain strong global sales. The re-branding exercise is not a direct response to the poor figures in January - such exercises take longer in planning - but it is part of the supermarket's long-term strategy.
In a sense Tesco has been a victim of its own success. The reason it is perceived to be in trouble is only really because it has previously been so dominant.
The fact is it is still making money, lots of it, just not as much as it once did, although its latest results are predicted to show that it is not back on form just yet.
what do you think?
Windows Live User
Analysts are wrong to say Tesco has cut its prices to far damaging its image. Britain needs more fair prices ans less profit at this time
They should try dropping their prices, I shop online and compare the charges of the supermarkets and haven't used Tesco for a while now as they charge more than the others.
Tesco fish, meat and deli is poor quality, fruit and veg are good also their own brands. Yes Tesco have become boring. Stop trying to con the customer as you have been in the past come clean with your ads. Since you sacked a young girl for taking out of date food home I have not step foot into Tescos stores, a lot of bad press lately. ??????????????? Morrisons have better offers.
Why all the doom and gloom. Thet have made 3.5 BILLION in PROFIT!!!!!! for christ sake how much money do these people need?
The prices Tesco charge for so called 'FRESH' fruit & veg is ridiculous. They have too may 'HALF PRICE' or 'BOGOF' offers on pruduce that is seasonally inexpensive anyway. I allways see strawberries at half price " was £3.99, now only £1.99". I have been selling fruit & veg for over 11 years and i have never sold best British strawberries for over £1.80 per punnet. It's a con
I have not spent any money in any Tesco for the last 10 years and will never do so. I think they are a horrible company employing bully boy tactics. They have forced through a planning application for a giant Tesco 24 hour hypermarket where I live paying total disregard to the local planning objections and when it opens this year the traffic will be gridlock as the local road network just will not support it. The nearest Tesco is about a mile away on the North Circular and generally looks like a rubbish tip on a bad day with empty, dirty shelves which attracts customers to suit. I am overjoyed to hear that people are voting with their feet - long may it continue!
Morrisons fresh salad bar by far beats Tesco hands down, in fact Morrisons beat Tesco hands down each time. Petrol as well !!
Too big for their boots! We have noticed big price increases, eg tesco own blue white baby wipes, 18p to 52p! Silly example i know, lol! But its the same throughout shop, they do their so called offers......and wack it on elsewhere! Hate the shop, wish we had a morrisons!
Windows Live User
All supermarkets are doing the same as greedy tesco. I have gone back to the high street to shop and the food is better. None of this rubbish about throwing good veg away because its slightly deformed and customers dont want that. Try your high street
They deserve this cummupance because they try to confuse (con) the public with their pricing offers. Two for one or three for two strategies means you have to have a calculator to work out the price of something. I know they all do it but Tesco are the worst of the lot. The Coop and Lidle for me. At least I can work out the prices.
Tesco's meat. fish, and deli is poor quality, their fruit and veg and own brands are very good.Tesco need to be transparent in their adverts some of their adverts are bodering on cheating its customers.Since a member of staff was dismissed for taking home out of date food I have not shopped at Tesco, I now shop at Morrisons just as good as Tesco even better in their deli and fish. Listen to what your past and present customers have to say, your stores have become boring and some of your staff not as helpfull as they used to be, one major complaint those big trolleys you have shopping, in some aisles as much as four trolleys nobody else can get through. listen ???????????????
Also the trolleys that dont work because they put that stupid wheel brace on themwhich also stops you walking up a moving escalator,guess what tesco ive been walking for 38 years and i can push a trolley safely take them stupid things off the trrolleys
I have noticed some comparing the merits of one supermarket against another. Has everyone totally forgotten the benefits of having a thriving High St. with top quality friendly service, variety and value? Perhaps there are no such High Streets left as everyone prefers to be ripped off with expensive boxed, tinned, frozen, deep chilled, reheated, kept heated, fat-laden, salt-laden, sugar-laden produce just as long as there is free parking and "points" to be collected.
You hit a nail. Free parking is an attraction and a lot of councils have ruined their own high streets with parking charges. Not a clever move.
they should stop putting items up in price then drop them saying we save you money.....local store to me has had a price increase and I have found you get less in some items than before...so who is saving who.... one soft drink I get went up by 15P overnight and then dropped again saving me... chicken went up £1 then dropped back saying me...I now shop more at asda
in the last 8 months they have put the price of value mince up from £1.90 to £2.40,taking that as a trend across the shops value range is it any wonder that people are not shopping there if you are on a budget you start shopping in shops with lower prices,theve hit the budget shopper too much with the price increases
forgot to add...I now check price and weights ......on all offers found it was cheaper to buy two items at normal price than go for the larger offer
And that tells us all we need to know about their attitude towards their customers. I buy everything from local shops because the profits stay local.
Tesco has lost a lot of ground against other supermarkets, one reason is because they have become too expensive e.g. a dozen Large free range eggs is £1 .10p dearer than at a farm shop, and another example a 500grm of Margarine of 'I cant believe its not butter' jumped up 21p this week. New packaging and shaped jars is not going to be the answer for other items, what the customers need is good value for money. They are trying to put too many different goods in one store, the clothing range which is quite good but you still feel you are choosing clothes in the middle of a grocery store, some dividing walls would be nice it would then feel like a different shop. The staff give the impression that they can't wait for the end of their shift to come. Morrisons have wiped the board with them in every aspect.
John, they are trying to replace your High Street. They are ruining the retail industry for the little guy and the customer is just there to be milked.
"Cutting its prices too far"? The only time they drop prices is when they've increased them in previous weeks, false advertising! Most companies would be glad just to break even in the present economic climate but Tesco are determined to claw every single penny out of their customers. Give us a break or we'll vote with our feet.
Good. There should be a minimum and a maximum price set for any shop selling food. I wouldn't mind but the farmers and producers are driven down on price so the profit margin is greater. Awful. If there weren't the farmers Tesco, there wouldn't be the food. Think about it, they should have the upper hand not you.
but would you pay £2 a pt for milk if tescos paid more to the farmer? i know i wouldnt
Gary Djuncleabe Kelly
I walked into a Tesco for the first time in 3 years last week and walked straight back out ... the staff are obnoxious and rude, the store looked like a warehouse and the prices well enough said. I mean after all they do have to pay Stobarts (thieves of the logistic trade). ASDA all the way for me.
maybe just your tescos as ive had no problems in mine with the staff,always friendly and polite and willing to help if i need it
In my area the staff I have spoken to hate working for Tesco. They threatened one lady with the sack because she was off sick for two days. She was genuinely ill.
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Tesco is excellent. Lots of very good, well-packaged products at reasonable prices. The counters are far longer than other supermarkets so you can put more shopping on them. Tesco is clean, well organised, efficient and helpful. If you don't like it, try camel riding in a desert and hunt stuff around an oasis.