Small shop closures are progress, says ex-Tesco boss

Sir Terry Leahy Sir Terry Leahy was instrumental in the rise of Tesco to become Britain's biggest retailer

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The former boss of Tesco has described the rise of supermarkets and closure of small shops as "part of progress".

Speaking on BBC Radio 4's Desert Island Discs, Sir Terry Leahy also called some High Streets "medieval", saying the way people lived their lives had changed.

Sir Terry said seeing boarded up local shops was sad, but this happened because consumers were choosing to shop at the bigger supermarkets.

The benefits of out-of-town stores outweighed the downsides, he added.

When asked if he thought it was just "tough" that a family butcher had to close because it couldn't compete with the "three-quid chicken" sold at the supermarket, he said: "Small benefits for thousands of families can be a big loss for the family of the butcher but you can never be casual about it.

"You have to ensure the better organisations come through."

Start Quote

I felt very strongly inside that Tesco was doing the right thing... but I realised I wasn't winning the argument for some people.”

End Quote Sir Terry Leahy Former Tesco boss

Sir Terry got his first job at a Tesco in Wandsworth, London, when he was 17-years-old so he could support himself during sixth form college.

The third of four sons, he grew up in a prefab on an estate in Liverpool. His father was a greyhound trainer and his mother was a nurse.

He said he couldn't please everybody when it came to views on supermarkets over small High Street stores.

"If you talk to people, 95% of the population quite like supermarkets but 5% don't, but in Britain this (5%) is three million people so they have a right to say what they think.

"I felt very strongly inside that Tesco was doing the right thing, in terms of how it was conducting its business, how it was serving ordinary people and how it was employing ordinary people but I realised I wasn't winning the argument for some people."

Large chains

The British Independent Retailers Association said 98% of the the UK's £150bn grocery industry was controlled by just nine stores.

But deputy chief executive Michael Weedon claimed there could be a silver lining for smaller businesses.

He said as large chains such as HMV and Blockbuster closed, more retail premises would become available at cheaper rents.

Among the tracks Sir Terry chose to take with him to a desert island were The Beatles' I Want To Hold Your Hand, Simon & Garfunkel's Homeward Bound, Depeche Mode's Just Can't Get Enough and Pachelbel's Canon in D.

He said he would also take The Complete Works of Charles Dickens and his luxury item would be tea.

As chief executive, he made his name transforming the supermarket from a lacklustre brand into Britain's biggest retailer.

Desert Island Discs with Sir Terry Leahy was broadcast on BBC Radio 4 at 11:15 GMT on Sunday 3 February


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  • rate this

    Comment number 659.

    at 640..hidden agenda... yes..I think this is true... business rates do cripple smaller indepent stores... so the problem lies with government... the world is in a recession and times are hard, so why not give tax reliefs to smaller business and let local communities grow and serve their needs. we dont always want what we see in supermarkets but sometimes there is no choice...thats a shame

  • rate this

    Comment number 658.

    Our local creamery went out of bussiness when Tesco's decided it would import the same products from France; a major employer for a small town, lots of people out of work and several dairy farms put our of business. Do you know where the chicken in the many chicken ready-meals comes from. Too many people never read the labels!

  • rate this

    Comment number 657.

    Germany doesn't have a monopolized superstore retail park sector,pay higher wages,have Banksters & managers paid less & a more fairer & dynamic economy & far less boarded up high streets

  • rate this

    Comment number 656.

    The man is correct but rather naive if he didnt understand there would be an outcry for saying that. The bigger towns and cities may enjoy a few supermarkets ruling all of the retail sector but most normal people recognise that we need a mix of big and small businesses. After all who would p[ay the taxes for schools and the NHS if all the big companies went offshore ?

  • rate this

    Comment number 655.

    Leahy is such a breath of fresh air - thank goodness someone speaks out for the poor tax dodging, monopolist, privileged supermarkets which get planning permissions showered on them by their nice town hall chums - its time those nasty little shops were all put out of business as idiotically trying to pay their taxes and earn a living & even argue against eg nice landlords putting their rents up.

  • rate this

    Comment number 654.

    if people dont like the rise of the supermarkets then maybe they should actually shop in the high street. The only reason for the decline is reduced customers in the high street. Dont blame tescos, blame yourself.

  • rate this

    Comment number 653.

    649.fredbmw - I accept your apology.

  • rate this

    Comment number 652.

    People bemoan the closing of small shops, but what do they want? Supermarkets to up prices so the small shops can compete? All of us to pay more, when most people can't afford to? Supermarkets banned from opening in some areas, so they're only accessible to those with cars?

    Things that WOULD help would be free parking & better opening hours, but nobody ever tries that.

  • rate this

    Comment number 651.

    Sir Terry unfortunately is utterly misguided, and his words reflect the trappings and failings of 'empire'. Diversity is what brings strength and robustness in nature, and in our economies. This misgfuided approach to business leads to thousands of people put out of business, replaced by a few low skilled workers in his own shop. Where is the gain? Council estate brain with council estate economy.

  • rate this

    Comment number 650.


    I agree with you. Seems to me that there are some powerful interests who stand to gain from the populus being hypnotised into behaving like, even believing they are, drones.
    Every little helps....them.

  • rate this

    Comment number 649.

    612 strothermartin
    by the consumer choosing to use these stores that gives them MONEY AND POWER, if they were not wanted they would not get this big.
    as for the fence, shout what you want BUT THEY RULE
    im not saying this is right, but you REALLY think that in their insulated world you can shout them down.... to late thats PROGRESS IN CAPATALISM... nothing we can do will change it.... sorry

  • rate this

    Comment number 648.

    We use small shops where we can, usually better quality and taste and we know what we are buying, (not horse meat) my wife cooks well and economically one of our big supermarket chains has just gone bankrupt.
    Long live the small trader. it is not too expensive as there is often less waste.

  • Comment number 647.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 646.

    Leahy has an economy of scale not progress.

    If high street rents and rates were lower, high street shops would survive. Rents need to be revised downwards by at least 75% if a supermarket opens in an area. The rates shortfall should be charged to the supermarket.

    Also the zero rate for VAT should be scrapped. It is merely a supermarket subsidy.

  • rate this

    Comment number 645.


  • rate this

    Comment number 644.

    197 - Editor's Pick - removed. Hilarious!

  • rate this

    Comment number 643.

    One aspect that not many here have dealt with: population growth: towns get larger, but the centres are fixed size - so causing ever more vehicular and pedestrian congestion at weekends (since most people work M-F). It's probably partially in response to this large retailers started building out of town sheds. Now, with 'anchor' stores going bust, the future of town centres looks bleak.

  • rate this

    Comment number 642.

    If you actually enjoy the process of shopping then you probably prefer the high street. If, like most, it's actually just a chore that needs doing the supermarket is far more efficient, saving hours a week for more interesting pursuits. And for more specialist produce just order online. Feels like progress to me. Electricity put candlemakers out of business, I don't mourn their loss either.

  • rate this

    Comment number 641.

    A local shop can not get the same price for 100 items,
    that somebody who buy's 100,000 can, simple pricing discounts.374

    That should be true but it isn't. There is virtually no price difference between a local shop and a supermarket. If you include petrol costs that difference (if there is one) vanishes. Forget old fashioned common sense econmics; they no longer apply.

  • rate this

    Comment number 640.

    627 james "you don`t have the choice in the UK..."

    Agree, and I think the high business rents and rates and council parking charges are to blame for that; it`s not all the fault of supermarkets.


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