Tesco chief product officer Jason Tarry has credited a second Reset phase focused on its c-stores, which launched before Christmas, with a strong performance in The Grocer’s Fascia Faceoff.
In the mystery shop, which compared prices not only against rival c-stores but its own supermarkets, a basket of nine items was just 3% more at a Tesco Express than a regular Tesco.
The first phase of the c-store Reset saw an 18% reduction in SKUs but Tesco Express stores have since cut a further 4% of SKUs, meaning almost a quarter of SKUs have gone, taking average SKU counts to 2,850.
Tesco began by resetting its core grocery range and before Christmas moved its beer offer away from lager to craft beer in urban Express stores.
Further changes are to follow in categories including health and beauty, household and beers wines and spirits, The Grocer understands. Tesco has also increased its own label line up by 11% in grocery.
Despite the cull, supplier satisfaction is improving. Tesco’s latest figures show 78% of suppliers were happy with engagement last year, up from 51% in 2014.
At the same time the own-label SKU count has increased by 11% with participation up by 4%, which has helped to improve its price competitiveness.
“We have rebalanced our pricing to ensure we are competitive across a much broader basket in the convenience marketplace, whilst protecting the integrity of our price hierarchy across our estate,” said Tarry. “We have done this by taking a view across every category rather than looking at convenience as a whole, [while] introducing more Tesco own brand lines in packaged goods categories where relevant and offering customers a greater choice of price points. In addition we have reduced the number of poor performing promotions by 30% - in particular multibuys - to improve relevance and consistency for customers.”