>>is tesco envy getting in the way of business?
We often talk about how the grocery market has polarised in terms of retail offer. But one of the fascinating things to witness at the IGD convention was the way in which the views of retailers have also polarised. In the blue corner was Tesco, with Sir Terry Leahy arguing that free competition was good for the country, the industry, suppliers and consumers. In the red corner was pretty much everyone else. They do not deny that Tesco is a first-class performer, but they do question how much longer it can grow before competition regulators act.
The key issue is Tesco’s market share. As our Tradetrak figures on p17 show, Tesco’s market share has grown from 28.7% to 29.1% over the quarter to October 2; its penetration is 54.5% and its average basket size is a whopping £116.11. It does not take a genius to work out that if Tesco has a great Christmas it will break the 30% market share barrier. Once it passes that milestone, the Tesco juggernaut will soon be heading towards 35%.
Is that a bad thing? Should Tesco’s huge market share be a reason for a market review? As Sir Terry pointed out, if the market had been frozen 10 years ago, Sainsbury would now be number one, Tesco would struggle to keep up, suppliers would serve a smaller market and consumers would have been denied billions in price cuts.
Sir Terry and colleagues are clearly frustrated by ‘Tesco envy’. After all, they say privately, no one from Cheshunt complained when Wal-Mart bought Asda. Rather, they got on with the task of taking on the world’s largest retailer. Clearly they think it’s time some of their vocal rivals do the same when it comes to taking on Tesco.
At the convention this week, we presented Asda boss Tony DeNunzio with The Grocer Cup for Outstanding Business Achievement. This award is special because readers of this magazine vote for it. And Tony is your choice. In fact, he is your overwhelming choice.
Under his leadership, Asda has taken on Tesco and while it is unlikely Asda will overtake Tesco in the current planning environment, Tony and his team continue to adapt, evolve and innovate in ways that make life tough for their arch-rival. Asda is a class act - and so is its chief executive.
ways to make tesco sweat
A class act
We often talk about how the grocery market has polarised in terms of retail offer. But one of the fascinating things to witness at the IGD convention was the way in which the views of retailers have also polarised. In the blue corner was Tesco, with Sir Terry Leahy arguing that free competition was good for the country, the industry, suppliers and consumers. In the red corner was pretty much everyone else. They do not deny that Tesco is a first-class performer, but they do question how much longer it can grow before competition regulators act.
The key issue is Tesco’s market share. As our Tradetrak figures on p17 show, Tesco’s market share has grown from 28.7% to 29.1% over the quarter to October 2; its penetration is 54.5% and its average basket size is a whopping £116.11. It does not take a genius to work out that if Tesco has a great Christmas it will break the 30% market share barrier. Once it passes that milestone, the Tesco juggernaut will soon be heading towards 35%.
Is that a bad thing? Should Tesco’s huge market share be a reason for a market review? As Sir Terry pointed out, if the market had been frozen 10 years ago, Sainsbury would now be number one, Tesco would struggle to keep up, suppliers would serve a smaller market and consumers would have been denied billions in price cuts.
Sir Terry and colleagues are clearly frustrated by ‘Tesco envy’. After all, they say privately, no one from Cheshunt complained when Wal-Mart bought Asda. Rather, they got on with the task of taking on the world’s largest retailer. Clearly they think it’s time some of their vocal rivals do the same when it comes to taking on Tesco.
At the convention this week, we presented Asda boss Tony DeNunzio with The Grocer Cup for Outstanding Business Achievement. This award is special because readers of this magazine vote for it. And Tony is your choice. In fact, he is your overwhelming choice.
Under his leadership, Asda has taken on Tesco and while it is unlikely Asda will overtake Tesco in the current planning environment, Tony and his team continue to adapt, evolve and innovate in ways that make life tough for their arch-rival. Asda is a class act - and so is its chief executive.
ways to make tesco sweat
A class act
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