Consumer unease at Tesco’s dominance is growing with one in three shoppers now believing the supermarket giant has become too powerful and is killing off competition and choice, an exclusive survey for The Grocer reveals. Eight months ago, just one in five consumers thought the same thing.
However, the latest survey of more than 2,000 shoppers also reveals that the same number feel that Tesco is a “great British institution”, while the retailer continues to score highly across a range of criteria including value for money and quality.
Nevertheless, consumers’ apparently changing perception of Tesco’s power is likely to add fuel to opponents’ calls for a market review.
David Rae, chief executive of the ACS, which has launched a high-profile legal bid to force the OFT to scrap its two-market view of grocery, said the research showed how Tesco’s “unfettered growth” had now become “a symbol for growing concern amongst consumers”.
He added: “These figures indicate a belief among consumers that this is leading to a reduction in choice.”
However, retail analyst Clive Black of Shore Capital insisted Tesco still had nothing to worry about. “Consumers are simply picking up on the louder noise being made by vested interest groups, but they are still walking into Tesco’s stores in droves.”
A spokesman for Tesco said: “The more successful we become, the more people we touch - so it is only natural and right that more people ask questions about us. It is our job to engage, explain what we do and show how we act in the consumer’s best interest.”
The Grocer’s research by Harris Interactive comes as Tesco continues to weather a storm of protest over new and extended stores. Protesters in Liverpool took to the streets this week to lobby against plans to double the size of the retailer’s Allerton store by building over university hockey pitches.
And the approval of a Tesco planning application in Exeter to add 25,000 sq ft to its store has dismayed local businesses.
In addition, the retailer is causing a stir among local traders in Brighton and Hove over plans to add a car wash facility to one store and open a new Express in Brighton’s Lanes.
Elsewhere, Tesco has been accused by Musgrave Budgens Londis and the Co-operative Group of targeting rivals’ c-stores to put them out of business.
MBL said its decision to shut its Budgens store in Fakenham, Norfolk, had been prompted by the approval of plans for a new Tesco store in the town.
MBL MD Mike Taylor said that the company was still battling plans for a Tesco store in Sheringham, despite the council having turned it down.
Michael Main, a member of The Co-operative Group’s northern regional board, said: “Tesco is deliberately opening near smaller stores. We have seen this, Somerfield and Budgens as well. The Co-op has many successful stores but if Tesco continues to target these stores, some will disappear.”
The Tesco spokesman said: “Good retailers do compete with supermarkets.”
>>p48 What Tesco backlash?
The Grocer News Team