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
    +1

    Comment number 959.

    Progress towards monopolisation! Good for Tesco, bad for the people...

  • rate this
    +1

    Comment number 958.

    It is sad but life has changed and I don't miss the que in the bakers, the walk down the street and the que in the butchers, another walk and then another que at the fishmongers and then another walk and another que in the grocers etc etc. Aslo the supermarkets can offer services the smaller outlets couldn't and employ thousands...keeping many off the dole.....'que.'

  • rate this
    +1

    Comment number 957.

    I bought a printer from a small high street shop as I wanted to support the local guy. It packed up after about 6 months. The shopkeeper said it was not his problem to get it returned for repair or replacement as 'I just sell them'.

    A major store would immediately send it off for repair whilst under guarantee.

    Enough said.

  • rate this
    0

    Comment number 956.

    He's acknowledging as simple fact that people's shopping habits change over time, so I think evolution would have been a better word to use than progress.

  • rate this
    +2

    Comment number 955.

    OOPs! I meant to say OFT hit Tesco with a £10"m" TEN MILLION POUND fine for price fixing.........sorry for typo

  • rate this
    +3

    Comment number 954.

    Closure of small business is not progress of any desirable form.

    Closure of small businesses means reduction of consumer choice; loss of retailers really knowledgeable about the products they sell, and increased unemployment.

    All this, and loss of service to the disabled and elderly who cannot travel to so-called "superstores", and run-down high streets and town centres.

    No benefit to Britain.

  • rate this
    +3

    Comment number 953.

    The Office of Fair Trading (OFT) hit Tesco with a £10 fine for PRICE FIXING dairy products during the time he was running it...........What was that you were saying Terry? or did you think "part of progress" is the bit where we would forget about it??...........LOL

  • rate this
    +5

    Comment number 952.

    949
    Not to mention that, along with Amazon, Starbucks and a fair few chain shops, Tesco don't pay their taxes. Why are the horse-burger eaters supporting tax-dodgers who are costing them money?

  • Comment number 951.

    All this user's posts have been removed.Why?

  • rate this
    +2

    Comment number 950.

    It's not as just small local shops disappearing, it's individuality altogether.

  • rate this
    +5

    Comment number 949.

    What happened to fair competition? 98% of our country's grocery business controlled by just nine companies and at least one of them has also been buying up land and buildings and stockpiling, it thus preventing other businesses from buying and using it. Where is the competition in that? Consumers are entitled to choice and should not have their choice dictated by over powerful big companies.

  • rate this
    +4

    Comment number 948.

    There is a corporate saying 'Nobody ever got poor by underestimating British gullibility.' Leahy has proved that by being getting very rich at the horse-burger eaters expense and with an undeserved knighthood for ruining our towns. Well done gullible Britons.

  • rate this
    -2

    Comment number 947.

    In terms of pure capitalism...... I am sure the bloke is right. Consumers want things in one place, selling in volume, cheaply, without fuss, or messing about...
    However, as human beings, the nature of individual small shops selling a single cadre of items is a far better 'social' happening.
    In the same way that the local pub is now an anachronism, so will local shops be in a very short time....

  • rate this
    +1

    Comment number 946.

    Alan, The Grocer 2012 identified 9192 giant superstores. This means:

    9192 superstores x each destroyed 270 jobs

    = 2,481,840 unemployed due to supermarkets destroying small shops

    Almost 2.5 million people - c the total number unemployed in UK - were put out of work by supermarkets.

    If supermarkets didn't cost the taxpayer billions in benefits we could all afford to shop in small shops

  • rate this
    +2

    Comment number 945.

    Tescos is really a PR company marketing rubbish, but it all boils down to choice; those that care about the quality of products they buy and give it enough importance and priority to find the time to shop at independent shops, and those that dont. The latter that believe the false marketing and think they are getting quality products for less money, the horse burger buyers!

  • rate this
    -1

    Comment number 944.

    942 Liberty_Rose: All the money that consumers save by going to the supermarket - and if they did not save they would not go - is available to spend on other things - which don't make themselves. I know it's hard on the small retailers, but nothing stays the same for ever.

  • rate this
    0

    Comment number 943.

    For your information, General Rab (205), you'd be ill advised to shop for groceries at Fortnum's these days.

    Sadly, they've become a posh version of the souvenir stalls that line Oxford Street - piling their branded boxes of tea and shortbread every bit as high as Tesco.

    I understand that Borough Market is popular for interesting food, though I still prefer Harrods - whose staff are unbeatable.

  • rate this
    +2

    Comment number 942.

    Alan T, you say you don't believe that supermarkets have destroyed around 1 million jobs in GB.

    National Retail forum survey 1998 found that new supermarkets so damaged local businesses that, in retailing alone, they produced a net loss of 270 jobs locally. And many more jobs are lost outside retailing.

    3,500 supermarkets x 270 job losses = 945,000 unemployed

  • Comment number 941.

    All this user's posts have been removed.Why?

  • rate this
    -1

    Comment number 940.

    He is right, we choose to go to better shops with more choice, cheaper prices. Further now they deliver, location is not that much of an issue either. No blame on Supermarkets, especially now all the other shops are dying off too, because Amazon is easier open 24/7 and delivers. Town shops have been rubbish for ages, since chains and food outlets bid up rents, ousting interesting shops.

 

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