Tesco focused on the business of grocery

The resurgence continues with a third positive LfL quarter in a row and shows profits growing. Project Reset appears to be doing exactly what it promised.

The offer that Tesco puts forward has evolved yet not significantly changed, it has been rationalised and the flow of goods on the shop floor made more accessible, simple changes, executed well.

The clearly defined store shopping missions, seeing customers journeys broken down into eat now, eat later today, top up and full shop is not only sensible, it is also effective. This in turn informed the Tesco range rationalisation and price architecture clarification which will have significantly helped customers navigate to the product they want more easily, thereby improving sales.

tesco farm value pricing

Price perception has been helped significantly with the Tesco Farms brands and despite media mutterings, the customers aren’t feeling misled, they are feeling well provided for with a product that meets price and quality needs. Tesco read the need and supplied it.

Away from the shop floor in the board room, the side show of the accounting fraud and the fact that 60 shareholders are potentially suing the company for loss of earning to the tune of £150M is just that, a side show. The best way forward is concentrating on the growth of the business and delivering value to the shareholders the only way they can. We don’t think it will be long before the skeleton is buried.

There are big steps still to take, the offloading of fringe businesses such as Giraffe, Euphorium Bakery and Harris and Hoole coffee shops lays a marker for concentrating on the core retail offer. Curious then that they have just climbed into bed with Holland and Barret for a 6 store shop within a shop concept.

tesco prosecco crisps

Can Tesco maintain the momentum through the vital Christmas trading, particularly when Morrisons are displaying some green shoots, Asda are being defensive and Sainsburys has a new ally in Argos? With the discounters’ growth slowing, Tesco do have an opportunity to push again on price should they need to and will no doubt have a rash of offers lined up to deploy tactically.

Dave Lewis has been the breath of fresh air that Tesco needed, an inside voice would not have dared to rip up some of the flights of fancy of previous regimes, Lewis has been the right man at the right time and while he remains focused on selling groceries, and not be distracted by any side shows, we see no reason why Tesco should be positive in the next quarter too.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *