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Tesco: Not quite infallible

Robert Peston | 10:34 UK time, Tuesday, 21 April 2009

Tesco's pre-tax profits last year were either just under or just over £3bn, depending on whether you think the statutory or "underlying" measure is the better yardstick.

I tend to prefer the statutory number, for all its flaws, because it's less amenable to manipulation by businesses - not that Tesco would indulge in any sleight of numerical hand.

And in Tesco's case, that would mean its profits grew by 5.5% to £2.95bn - or 4.3% after adjusting for a rogue 53rd week in the 2009 figures.

For what it's worth, Tesco would argue that its profits grew 8.8% (on an adjusted 52-week basis) to £3.1bn.

Not that it's worth having a punch-up about.

On either measure, it's a solid performance in ghastly global economic conditions.

So the results are a reminder that even in a recession, the British and world economies are very substantial indeed.

The British economy may be contracting, perhaps by almost 4% this year, but that means the UK's output will diminish to the level of three or four years ago - when we weren't paupers.

So there are lots of profitable opportunities for entrepreneurs and businesses that know what they're doing.

Tesco bags in trolley

What's striking is that British consumers are still playing a disproportionately important role in fuelling the economy: they are spending a good deal of the cash put in many of their pockets by cuts in interest rates; there's a bit of extra saving going on, but not as much as you might expect given the uncertain economic outlook.

And lest we forget, the reason why Tesco's results are such a good barometer of what shoppers are doing is that it is so blinkin' enormous.

Tesco has around a third of all supermarket sales.

And even in non-food, it's a giant: at £8.7bn, its UK non-food turnover is well over twice the clothing and general merchandise sales of Marks & Spencer.

It's not exactly a minnow outside the UK either: total international sales were £17.9bn, up 13.6% at constant exchange rates (including the benefit of the sharp fall in the value of sterling, overseas sales rose 31%).

What the figures show is that British shoppers are not partying on the Titanic, but nor are they battening down the hatches, hoarding the cash in the mattress and only eating tinned baked beans.

There are two or three other notable features of Tesco's numbers.

Given my eccentric interests, you won't be surprised that the fat returns made by its financial services arm stood out for me.

This made a gross profit of £627m on loans and other assets of £6.2bn.

Even after a charge of £134m for expected losses on lending and £249m of running costs, the operating profit was £244m.

At a time when many of the world's biggest banks are struggling to make any profit at all, that's a pretty handsome rate of return.

At this relatively early stage in its development, Tesco Personal Finance is already a player in financial services.

The matter-of-fact confirmation today that it's planning to become a "full-service retail bank" should give the willies to every traditional bank and building society.

However, Tesco is not infallible. Its brave new US venture is making bigger losses than it hoped - and won't do any better this year.

Also, after years of performing miles better here in the UK than its smaller rivals, they are catching up a little bit.

Sales per unit of selling space are currently growing faster at Morrison, Sainsbury and Asda than at Tesco.

There are two reasons: they're better managed than they were; and the recession has hit non-food sales, where Tesco is bigger than most other supermarket groups, harder than food sales.

That said, this catch-up by Sainsbury et al is like saying Everton and Aston Villa are narrowing the gap with Manchester United and Barcelona.

Or to put it another way, on a good day for the opposition, Tesco can be beaten in the odd game; but its grip on the title doesn't look any less firm.

Comments

  • Comment number 1.

    Stop ! Wait a minute Mr Peston : We've got a) What's striking is that British consumers are still playing a disproportionately important role in fuelling the economy. and b) Returns made by its financial services arm stood out for me. This made a gross profit of £627m on loans and other assets of £6.2bn.
    Join these two together and we have : Tesco shoppers borrow money from Tesco to buy stuff from Tesco.. and this what ? : a good thing, a sign of a healthy economy, green shoots ? there must be a better way to run the Economy - and there is using NEFS Net Export Financial Simulation see www.worldnews.blog-city.com

  • Comment number 2.

    Tesco is a virus. It interferes, in my opinion, where it has no legitimate right to be involved. We live in what used to be greenbelt. The council want to widen the M1, build a dual carriageway through it and build 3,000+ houses. This will join Loughborough to Shepshed. Two separate towns will become one. And further building is planned to join the village of Hathern. Locals do not want it. But Tesco are supporting the venture. Why? They cite over shopping in existing stores. So they want another store. Do I hear "Here's a chance for more money" perhaps. They, in my opinion, now interfere in local planning where they have no legitimate right. I have nothing against successful companies. But when they, in my opinion, use their might to interfere in local issues, for their own gain, I object strongly.

  • Comment number 3.

    It'll be good to see Tesco become a full service retail bank Robert. Think about it, a one stop financial shop. Mmmmm catchy hey?

  • Comment number 4.

    Good news but hardly astounding - Its total debt has gone up from £8 billion to £9.6 billion. Take that figure off post tax figures and, though an awful lot better than many companies, there is still room for improvement. A £10 billion debt on a capitalisation of £27 billion is not too healthy in a deflationary environment

  • Comment number 5.

    3,

    Patent that phrase now to earn a few quid ;-)

  • Comment number 6.

    Picking up your point on the financial arm and its good margins . Just shows that there is still a good profit to be made out of "old fashioned" retail banking. With restricted competition due to the government stitch up with Lloyds / HBOS ,retail banking is going to be very profitable for years to come .

  • Comment number 7.

    At 11:18am on 21 Apr 2009, VentilatorBlues wrote:
    Good news but hardly astounding - Its total debt has gone up from ?8 billion to ?9.6 billion.


    Is that really true? Ventilator Blues suggests it's a frightening figure if we are now moving into a deflationary world. Isn't it even worse if we get the other likely outcome of quantitative easing, which is a spike in inflation and a rapid rise in interest rates? When that happens, although the value of the debt itself will fall, we can expect to see demand fall off yet another cliff, and bad debts proliferate, just when the company's debts become more expensive to service.
    The point about bad debts is important, given this move in to the financial sector. I've seen this described as a return to old-fashioned retail banking - but it's hardly the old-fashioned business of ahaving a manager who knows how many kids you've got and worries about your overdraft, is it?

  • Comment number 8.

    Robert - is it the weather or have I spotted a ray of sunshine in todays blog? Yes, a four percent contraction means that UK output will only diminish to the level of 2006/7 and things were not so bad three or four years ago. Right now we need more positive messages in the media . The Survivors Guide To The Credit Crunch helps readers to bounce back from the downturn and boost their personal resilience.

  • Comment number 9.

    Tescos' bank?
    There must be millions of people who can't wait for Tescos (a sensible and brilliantly run company) to open its' bank.
    All of us who loathe the " City spiv" phenomenon can't wait to put our savings and current accounts into it.
    A bank backed up by a successful and vital industry....it must be a winner.

  • Comment number 10.

    Tesco's results prove just like Google's a strong Brand continues to expand even in a full blown global downturn.
    Britain could do with re branding and a new management team.

  • Comment number 11.

    I'd say Tesco - probably meaning the great Leahy himself - is not afraid to back a judgement or two (OK, speculate if you prefer): there's every sign they saw the downturn coming a lot earlier than most, de-emphasising the 'Finest' range and revamping their 'value' lines nearly 2 years ago now, making them less susceptible to the Lidls of this world

    In any event, they could teach our lacklustre government a trick or two on service-delivery - and employee relations

  • Comment number 12.

    The only thing left for Tesco will be to become a pollytrickall party and turn parlamment into a superstore with the MPerrors opperating the check outs on minimum wage whilst filling their aisles with something decent like give away dydle doe from the BOE ,the voters would go for that in droves as most are fed up with the incomebent raving loony party.

  • Comment number 13.

    My old stomping ground in Thornton Heath was killed off as a High Street many years ago by Tesco. I am sure that Morrisons, Asda and Sainsbury would have tried to do the same if they had bought the site, Tesco just got in first and did a thoroughly efficient job of it.

    They are ruthlessly good at what they do - too damn good. But familiarity breeds contempt and like McDonalds, they can fall out of fashion....

    If you are one of the millions who shop in Tesco then you are part of the problem and not the solution. In the age of Home deliveries and Farm shops I find it hard to belive that there can be more than a tiny number of locations in the UK where they have an unchallengeable monopoly on the "weekly shop".

    We only have one weapon and that is never to darken their automatic plate glass doors for any reason.

  • Comment number 14.

    I think you missed the 'bloomin obvious' Tesco's is now an uncontrollable, unstopable force and one we will all ultimately pay an extremely high price for, even if we don't shop there at the moment.

    If Tesco's is allowed to continue to grow at this rate, all competitors will disappear and then Tesco's will be able to charge what ever they like to you the customer, they will open at times to suit them, they will screw their suppliers down even further. They have their figure in every pie, so that is everything you will need to survive, food, clothing, petrol, banking etc.

    People are so like leemings or lambs to the slaughter, why can no-one see the utter stupidity of supporting a retailer, who is hell bent on destroying every competitor out there be it large or small.
    Those who shop at Tesco's should be very aware of what they are supporting, this is not about cheap food ( if it is why are their profits so obscene) its about total dominance and the public are mere pawns in their war.

  • Comment number 15.

    Given a choice, the Labour party, Tories or the Tesco board of directors to run this country and get us out of this mess...I know who would get my vote. Whether you agree with Tesco principles or not, I would rather have them making decisions about the countries economic future than our unelected, unstable so called leader GB.

  • Comment number 16.

    Of course with their 'monopoly market share' how soon before Lloyds TSB C&G Halifax Bank of Scotland can resist the temptation to start selling Beanz & Jeans ??

  • Comment number 17.

    very good balanced article imo, Tesco is reaping the rewards of satisfying customers preferences. The comparison to M@S who, imo, just assumed customers will always shop with them without listening to them, or giving a value for money quality product is eye catching. There is not tumbleweed rolling down the high street and there is activity for good retailers. I do accept though, being able to offer a one stop, out of town shopping option, does require a critical mass. To keep the football analogies going, if your goal keeper is proactive in comming out to help his defenders, then this is a risk which he will get wrong a few times, this though does not outweigh the benefits of all the times does the right thing.

  • Comment number 18.

    Well done Robert nearly a none Banking story!

    Keep trying you break out into the real world one day.

  • Comment number 19.

    Oh dear Mr Peston, you've been taken in. The real issue here is not how big, brash and profitable Tesco is or might seek to become. The real issue is that over the next 5, 10, 20 years at the very most (as cheap energy becomes a thing of the past ... possibly 'overnight' if some analysts and experts are to be believed) we need access to very localised, non-car-dependent shopping for provisions and life's essentials. Tesco growth has been on the back of the pillaging of small town/village shops. There'll come a time ... sooner than many people think ... when Tesco's business model will be discovered to be unsustainable ... reliant, as it is, on the fundamental assumption that worldwide transport energy is cheap and will be so for ever more. Here's the future: https://tinyurl.com/yoscvn ... and it isn't Tesco.

  • Comment number 20.

    Tesco, good at banking? Hold on there! Assets of £6.2bn sounds a lot but in banking terms, at this stage of the Tesco banking GROWTH "story," it means they can be (and are probably being,) very choosy about which type of customers they provide credit to. Their credit scoring will probably be quite tight and this isn't a bad thing, but as you can see, even with tight credit scoring, you still get bad debts Which Tesco themselves are saying will be a £134m pounds worth! OK, so this amount may be because of the current economic environment, but to date you have got to say Tesco's banking is being really predictable.

    But are you also trying to suggest that Tesco Banking would not have tried it on in the debt securitisation or derivatives markets if its asset base wasn't much larger, say £62.0bn? Suppose Tesco's had also been in banking for 50+ years, giving time for the asset base to actually grow to that level? I think it would have been there same as everyone else in that league. Tesco would have been greedily (and catastrophically) chasing the same profit levels as rival banks. Using the same high pressure selling tactics used by all UK banks which embrace the Sales Culture, (and bitterly contest any attempt to regulate it.)

    On the broader picture of the UK consumer, you may want to take the view that this means the recession will be shorter-lived. And stick there. Well it would be churlish not to want a shorter recession.

    My concern is, "The Information and the resulting Conclusion." What information? The type of shopper that uses Tesco and how much money they seem to have to spend. What conclusion? If I were The Chancellor and had a massive (gaping?) hole in the country's finances to deal with and was looking to fill it, with tax rises, who should these targeted at??? Seems The middle classes ain't doing too badly?

  • Comment number 21.

    Ah now is time for the bash Tesco's campaign - how dare we have a domestic retailer who is a success! We should all flock to Asda at once (owners = Wallmart, accused in the US of what Tesco's is doing in the UK). Tesco's has a great business model and is ruthless in its operation. Yes, I am sure it has screwed its suppliers on prices (didn't they agree to deal with Tesco's in the first place?) and exploited its position of being bigger than everyone else - BUT, didn't it trade its way there? It's not like it is an ex-government monopoly which was 'gifted' its position - it is the biggest because, for whatever reason, it has managed to get the most customers through its doors. All the cries of it killing the high street and local shops are true - it has, but this is because CUSTOMERS have decided to go to tesco's rather than to the local shops.

  • Comment number 22.

    This is great news and a credit to Tesco's and their staff as a whole!!

    As Robert says, contrary to popular belief in the press, the British shopper is still very much alive and spending in a huge economy. I suspect if we focussed a bit more on the positive aspects of our country, a lot of people and businesses would feel a lot better and the recession would end sooner.

  • Comment number 23.

    If Tescos can resist the temptation to rip off savers and borrowers when interest rates change then bring on their banking arm asap. Perhaps they could also do us a favour of buying out the MPC too.

  • Comment number 24.

    How long before Tesco become too big to fail?

  • Comment number 25.

    # 21 Horned-Devil

    Yes, that's right; I agree; and well done Tesco! However, Tesco's business model relies fundamentally on infinite supplies of cheap energy. Mankind's era of cheap energy is ending fast, masked to some extent at the moment by the global economic downturn. As/if/when the economy picks up, watch the price of oil shoot back into the stratosphere, and some. At that point, it remains to be seen whether Tesco's business model (and that of other similarly organised companies) is sustainable.

    My money's on Farmers' Markets as the way to go, not a shop predicated on flying stuff in from Venezuala, Japan, Greece or wherever and then trucking it all over Europe and the UK before customers drop said stuff into their shopping baskets at bottom dollar prices. It can't last, so Tesco's customers and shareholders should make the most of this while they can: I'd say for 5 years at the very most. Then, all bets are off.

    So, again, well done Tesco. But look out behind you.

  • Comment number 26.

    Tesco has always had an eye for the profit margin. My understanding is that they switched more into clothing and consumer durables purely because the margin was higher than on groceries. They bolted this business onto a very developed and well costed distribution model and so their profits have held up well. Their shift into retail banking will be done on the same no-nonsense well-costed and profit-conscious basis.

    The problem that Tesco actually has is that they are a down-market store. The quality of their food offer is minimal to poor and their special price-cut offers verge on the devious. They have lost my business for that reason. Their capability to expand into the more profitable quality food market is very constrained and will continue for the forseeable future.

    Tesco has benefited greatly from the downturn in that the damaged middle-class have abandoned the farmers' markets for the Tesco offer. Needs must where the devil drives. Whilst for some this is the future for others it is just a temporary stopping off point.

    Tescos will continue to perform but the profit growth will tend to come more and more from off-shore developing markets rather than from within the UK. They have a strong business model but they are not a quality retailer. There will always be room within reason for the quality trader whether as a small chain or an independent.

  • Comment number 27.

    "The British economy may be contracting, perhaps by almost 4% this year, but that means the UK's output will diminish to the level of three or four years ago - when we weren't paupers."

    Quite so. But which sector(s) are bearing the brunt of this decline in GBP ? Anything that moves us towards an even more unbalanced economy can't be a good thing.


  • Comment number 28.

    all i can say is,
    " every little helps "

  • Comment number 29.

    Before we all get carried away, doesn't Sainsburys already offer banking products, and didn't Tesco try in-store retail banking with the Midland more than 20 years ago? So what's new?

    And let's not forget that the Co-op movement has been in banking for rather a long time as well.

    I suggest that you might get a more ethical service from the Co-op than from Tesco, and one more in tune with the times.

  • Comment number 30.

    Tesco's scores in many ways, not least because their petrol is always the cheapest in whatever location they are based and you get double club card points for purchasing it..why bother going anywhere else?

    The 'traditional' high street was screwed not just because of Tesco's, but because of the intransigent attitudes of local councils towards such fundamental amenities as a 'Car Park' which if they had heard of such a concept, decided to place it a mile away from where the bulk of shopping activity took place. The venal business rates charged by many local authorities which forced most independent retailers to charge way over the odds in comparison to the chain stores is another factor.

    In an environment where most people really don't have much disposable income whatever their salary level, the likes of Tescos and Primark have business models in place which understand this reality, many other retailers don't appear to have the will or ability to do the same..

  • Comment number 31.

    Tesco to rule the world.... oh they do!

    I'm off to get a haircut...
    damn other idea for Tescos......
    oops Another profession down the pan
    whos next.

  • Comment number 32.

    -clickdigitalmedia
    We need to help build our econonmy to provide jobs for people that are currently losing them.

    These Tesco results are historical , they aren't taking into account the future impact of a million or more people without a job which will hit Tescos income.

    Spending in only one part of our economy and we need to support and help the rest of it to help create jobs for those they are currently being made unemployed.

  • Comment number 33.

    Just an aside but is it purely coincidence that the end of the stock market has coincided with you coming back from holiday Robert?

  • Comment number 34.

    Hum, greed is not a capatialist attribute but one of Human nature.

    The big supermarkets have killed of many things in our society and country, high streets , farming and many other small buisnesses.
    The garden of England has been destroyed but these supermarkets.

    We have mono-agri buisness which the bees do not like. Nor me either.
    I was one of the last hop pickers , now there are none, BUT we still drink rather more that 30 years ago ?


    they are magnets for distributing wages to the top earners along with pensions at the expense of the lower paid.

    It is the job of goverenment to provide the framework with as little interference as is possible , say by limiting market share or plan rules of massive out of town developements. Such that too big to fail is NOT an option. whether it is with the banks or suppermarkets


    for the last 13 years lady T has not been at the wheel but a Mr Blair and Mr Brown whom have not been doing there job at all well. They have been asleep at the wheel pretending everthing is OK when in fact there where many structural issues that needed adressing BUT as the money was rolling in they choose to ignore these problems.


    Lady T broke the Pub chains when they got to large ?
    Why are the Supermarkets not being broken up then?


    As I have said previosly many of these large Corps need bring down to size Not because I'm a commie or antie free market BUT to protect Freedoms (go see we will rock you for an explanation re global soft.

    At this is the point Zanu-labour do not like Free markets and well runing capitalists economics as it only require samll governement, not large scale interferance by the state thus leading to disasster, as in now.


    its all about CONTROL , CONTROL and more CONTROL.

  • Comment number 35.

    Won't be long now before we have a tesco value economy.

  • Comment number 36.

    I feel that much of Tesco margin may be gross sales being expanded due to Consumers paying more for food as sterling falls.

    much of Tesco products must involve imports and financail services aside, their numbers would rise if sterling fell against a basket of currencies. With stering down over 25% in one year against the dollar and Euro any food imports from Spain for expample would sell at higher prices on Tesco shelves.

  • Comment number 37.

    It doesn't take long for the peak-oilists to get their tin foil hats out, does it?

    As to the hand-wringers, I would say this, if it was not Tesco it would be SuperPrix, WalMart or Spar (as in the gigantic Spars in Europe as opposed to the wee ones we have here) that would be dominating the landscape.

    Most people don't have the desire nor the inclination for smaller stores on high streets. As mentioned upthread, town centres have fallen out of the way because of usurious rates applied by decades of backward council-planning.

    If there were more Terry Leahys working in councils we would all be in a better state.

  • Comment number 38.

    I've just seen a very negative comment below complaining about Tesco having an increased overall debt of £9.6bn. I would like to pick this up and put positive spins on it that may just brighten up that readers day.

    1. By increasing PBT Tesco are demonstrating good management of costs, whilst maintaining a well diversified business, built on the relatively recession proof food industry. Surely businesses like this should be looking to ytake advantage of the current climate and grow in line with profits.

    2. If PBT is at £3bn EBITDA may be up around £4bn. Overall debt is £9bn lets use this as a Net figure (although this is before considering how much is bank debt and how much cash is in the business) this provides us with a net debt of 2.25 times EBITDA which seems very reasonable to me.

  • Comment number 39.

    On your case, Robert, many people are spending money that would otherwise go on mortgage interest. If so, when the rates inevitably go up (and it can't be long) is when the spending will dry up and the second cliff-edge will be slipped-over.

    If I'm right in thinking predictions are that will happen back end of this year, what chance of Crash calling an election in early autumn?

  • Comment number 40.

    #19 Moraymint

    "Tesco's business model will be discovered to be unsustainable ... reliant, as it is, on the fundamental assumption that worldwide transport energy is cheap and will be so for ever more"

    I'm afraid that Tesco have already cottoned on to this one - have you noticed the hundreds of Tesco Expresses opening up in High streets? I now have of them within walking distance of where I live.

    Not entirely sure why people are so keen to have a go at Tesco. If you don't like it, don't shop there. If you think people go to Tesco because they don't have a choice, open up a cornershop and compete. Unless you want to live in a communist society, you have to accept that big companies will swallow up small ones, I'm afraid.

  • Comment number 41.

    "it is so blinkin' enormous."

    Gosh - top hole, ole bean, don't you know.
    But..must fly...I'm off to re-read some of my 1950s Eagle comics.

    (;-)

  • Comment number 42.

    When considering Tesco's growing dominance of the retail sector, those of us who, like myself, look at the world from a Distributist perspective, should bear in mind G. K. Chesterton's observation that the best way to support small shops is to support them.

  • Comment number 43.

    With food inflation running at 10% and their profits up 8%, what is all the fuss about?

    Does no one care that Tesco is making so much out of a 'basic for life' when we are approcahing record unemployment.

    I am glad Tesco is moving into banking as hopefully their greed at others exspense will kick back in their face, although I am sure Terry has his pension sorted out.

  • Comment number 44.

    Whether Tesco have the midas touch remains to be seen, but they certainly seem to possess one vital factor that is lacking in the country as a whole, consumer confidence, and this alone can make or break a company or country for that matter.

    Tesco for government?

    James Aven
    [Unsuitable/Broken URL removed by Moderator]

  • Comment number 45.

    I would be interested to discover the margins that Tesco have managed to squeeze from their suppliers

    Far from being an efficient organisation I do believe that the poor policies at Tesco are hiding behind their commercial domination of the market, and it is these suppliers who are paying for the smokescreen.

    There does, however, come a point when they will run out of suppliers to prop up their regime and they will have to seize the nettle and thoroughly reform their business plan. Until then they will continue to waste money because it is easily covered.

    I am also concerned about the amount of debt that they are now carrying, and one serious mistake could see them breeching their banking agreements.

  • Comment number 46.

    Tesco is undoubtedly a good shop. We all like to buy things cheaply. After all when carrots ran out this year in the UK because the supermarkets undercut prices making it impossible for UK farmers to make a profit they had to be imported from Australia. This is crazy but this is the buying power exerted by Tescos and the like.

    What is frightening is the power it and all the other supermarkets have to destroy the other shops if it happens to alight in your town or village. The individuality of these places is wiped out overnight and many shopping streets are left or will be left as ghost towns, which has its own social problems. It seems to be able to dictate planning, even road usage. This power could be dangerous if it becomes a bank too and starts to impact on our finances. Where will it end? Will they bury us too?

  • Comment number 47.

    Tesco has provided what people want for years. We get what we ask for. Perhaps we can all learn something from the way the business is managed. It has achieved a size that gives it genuine clout in any market in which it chooses to play. It has been big for some time. Remember what happened to Green Shield stamps when Tesco stopped its relationship. A happy and distant memory.

    I hope that we are not going to get the "Four legs bad, two legs better" syndrome in the future. They cannot do any worse than the Banks, but they could join them in offering poor service and expensive products in the future.

  • Comment number 48.

    Thanks for the business story - much appreciated. Could you please spend a little time looking at UK manufacturing. While I understand that the "whole" economy is currently forecast for a 4% drop in 2009, and that's only equivalent to going back a few years etc, I'm looking at a scenario in which our first quarter sales are down 22%. Because we're not stupid and saw it coming a year ago our P&L is no worse than it was at the equivalent point last year. But I obviously can't say if 20 odd % is as bad as it's going to get or if it's just the top of a very big slide. Others on this blog and on Stephanomics etc, seem to indicate that they have the same level of problem. Given the inevitable lag in collecting commercial info and the fact that Government revisions are steeply in one direction, how confident can we be that forecast GDP is anywhere near accurate? And what would be the implications of - say - a 9% drop?
    TM - StH

  • Comment number 49.

    #46

    If they bury us too will they also change their name to 'Co-op'?

  • Comment number 50.

    47#
    'Remember what happened to Green Shield stamps when Tesco stopped its relationship.'

    It became Argos.

  • Comment number 51.

    I've never been to Tesco - is it any good?

  • Comment number 52.

    #51 You've never lived! Its an interesting social study if nothing else...

  • Comment number 53.

    A few years ago, when we had some money to spare, my brother suggested investing in Tesco's. We refused on ethical grounds (see Chister2 and more) Ok we might have been a bit richer for it, but squeexing supplier margins and closing down High Street shops is not our style.When is Britain going to wake up to the fact that we cannot always have what we want at the expense of someone else?

  • Comment number 54.

    # 29 tcrooks3843

    The co-op, it seems, can be as bad as the rest:
    [https://www.theargus.co.uk/news/2225143.forced_to_quit_over_bunch_of_dead_flowers/%5D

    Though "The Co-op denied she was sacked over flowers and said there were several breaches of procedure on her record." (One sincerely hopes that these breaches were every bit as heinous as giving away superannuated flowers.)
    [https://news.bbc.co.uk/1/hi/england/sussex/7367667.stm%5D

    #21 Horned_Devil
    You have a strong point - as you say it is admirable that they traded their way to the top - with some judicious acquisions.

    However, they (and other supermarkets) have also "played the system" and exploited their clout. And when clout is exploited, the case for break up grows (be it of Microsoft or Ma Bell). Break up is not even intrinsically "anti-business" - since it can spread expertise and ideas to prosper more widely).

    A quick Google for examples of clout being exploited reveals the following submissions to the Competition Commission.
    1) British Independent Fruit Growers’ Association (BIFGA)
    are concerned that "British suppliers (through fear of delisting) [might be] afraid to complain of inequitable practices."
    2) Their concerns were reiterated by the National Union of Farmers (NFU)
    "Although the NFU continuously received complaints about the multiples’ buying practices, its members were afraid to supply supporting evidence because of their extreme fear of commercial reprisals if specific examples were given."
    2) British Printing Industries Federation
    report that "93 per cent of the respondents [in the Federation] had said that the incidence of retrospective rebates was greater in multiples’ contracts than in the rest of their business. Other problems were the
    frustrations and uncertainties of short-term contracts and constant retendering and contributions to the cost of product launches"
    (Not that we expect much fair play in Britain these days, but even by current standards some of that sounds sharp.)
    3) The Campaign for the Protection of Rural England (CPRE)
    is concerned about Food Deserts "where, due to the absence of effective competition within the retail sector and low levels of mobility, poorer sections of society were unable to obtain high-quality, low-cost food products"
    [[Unsuitable/Broken URL removed by Moderator]]

    etcetera etcetera

    And, of course, they also play the planning system. Building up land banks, and placing restrictive covenants on any land that they do sell, to stop competitors moving in.
    [https://www.thisismoney.co.uk/news/article.html?in_article_id=408779&in_page_id=2]

    Again, when is a political donation not a political donation
    "Tesco says it made no political donations during 2003. During the year the group made contributions of £44,713 (2003 - £31,282) in the form of sponsorship for political events: Labour Party - £14,368; Conservative Party - £5,502; Liberal Democrat Party - £6,340; Plaid Cymru - £1,300; Fianna Fáil - £1,203; Usdaw (the main union for Tesco employees) - £16,000.115"
    [https://archive.corporatewatch.org/profiles/tesco/tesco3.htm%5D

    And when is a politician not a politician:
    "According to Red Star research, in the late 1990s Tesco executives featured on six government task forces, more than for any [other] single company and far more than the other supermarket chains. These included Terry Leahy, who sat on the Board of Trade's Competitiveness Advisory Group (although from the DTI website it is unclear whether this still exists in 2004) and former Tesco Retail director, Michael Wemms, who was a member of the New Deal Task Force."
    [ibid.]

    And when should a local planing decision really be reversed on appeal. (Hint, the minimum criterion should be for the applicant to get their facts straight.)
    https://www.independent.co.uk/news/business/news/tescos-attempt-to-put-record-straight-meets-stiff-resistance-431279.html

    For anyone hoping that peak oil etc. will bring back a fairer kinder world, though, it's unlikely to come without a struggle. The way I see it "out-of-town" shopping centers are a strong set of industrial assets to be deployed to meet whatever the demands of the time from home delivery to more locally sourced produce (which is already being played up by Waitrose.

    But don't get me going on out of town developments. They were on their way out in 1995 (under the Conservatives), now what Damascene conversion made NL reverse that trend (and did they ever tell us they were going to do so).
    https://www.independent.co.uk/news/uk/politics/gummer-moves-against-outoftown-retail-sheds-1592267.html

    Quite enough ranting for one blog comment - have you guys heard Susan Boyle sing "Cry me a river" on YouTube - real sole music to calm one down.

    Noddingly

  • Comment number 55.

    If only business managers with the expertise of Tesco's management had been running Britain, instead of the witless money grabbing Labour party under the leadership of Brown, this nation might just have been in the position he likes to claim it's in , of being well placed to come out of recession. Instead it is in a worse position (and worsening ) than any other country in Europe and a good many outside Europe. No amount of soundbite and lying in tomorrow's budget statement will alter this fact.

  • Comment number 56.

    Tesco's profits come from the high prices paid by the consumer. It is not something to be congratulated.In many other europeaan countries, it would not be tolerated, and the supermarket chain would be warned to reduce prices. Only in the UK, would you be pleased to see how much you have been ripped off !

    frank leigh

  • Comment number 57.

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

  • Comment number 58.

    @53 and others

    Yes, Tesco squeeze suppliers, as does every other business out there - its part of the way we do business (rather than, say, a government controlled pricing scheme which dictates all prices that goods can be sold at - kind of thing operated in Zimbabwe..)

    The fact is though, these poor suppliers all decided to get into bed with Tesco's as they thought they would make more money out of them - eg a farmer who knows his whole crop will be bought by one supplier at a smaller margin per product rather than trying his luck on the open market or going to the expense of dealing with many buyers - all of these poor suppliers are in business as well. If they didn't want to deal with Tesco's they didn't have to - it was their choice!

  • Comment number 59.

    Bank charges - where can i post my views on that one

  • Comment number 60.

    # 58 Horned_Devil

    Ah, but can I put my supermarket shopping bill on a credit card and then, at the end of the month, decide to pay a lower price because I didn't get the bonus I was expecting?

    Or have I misunderstood the supermarket practice of "Retrospective price reductions".

    Can't think of a similar analogy for the supermarket practice of asking suppliers to assist funding of special offers. But that seems bizarre too.

  • Comment number 61.

    60

    I always thought retrospective discounts were based on volumes sold by the retailer of the suppliers products - the discount is based on an agreed contract rate and is an example of economies of scale in operation. It is an incentive for the retailer to sell more of the given suppliers products above other suppliers and is meant to represent a retrospectively placed volume discount (eg a discount for buying more)...or maybe I have gotten it wrong.

    Marketing promotion contributions are again asking the supplier to put some skin into the costs of the promotion of their own products (eg sharing the costs of a special offer). These kind of practices exist in most supplier/retailer relationships and aren't exclusive to Tesco's (or even big boys - I used to work for an internet retailer who had the above in place with a supplier who was 20x the size of us

  • Comment number 62.

    To be fair i'm not the biggest fan of tesco as to what it has done to other areas in terms of contributing to the down fall of many high street stores.

    The fact still remains that it has become such a successful business model due to keeping things simple and identifying & diversifying into profitable gaps in the market.

    For which i do applaud them.

  • Comment number 63.

    surely if Tescos mainly sell food and food inflation is 10% then you would expect profits to go up by around inflation?

    Sales 100
    Less
    Costs 70

    Gross Profit 30

    Add 10% inflation to costs and Turnover

    Sales 110
    Costs 77

    Profits 33

    Hey Presto - Profits up 10% - if you add to that the fact that their other costs will not have increased by as much eg Wages and that their financing costs will have come down then an 8% profit increase when they are mainly selling what most people consider essentials is a bit disappointing really.

  • Comment number 64.

    A good result for Tesco, while they match the moment.

    I'm in food retail and Tesco is not my problem, or any other supermarket for that matter. I've just eaten a piece of Appelby Cheshire on an Orkney oatcake and on that level I'm feeling good and out of Tesco's et als' reach.

    My problem is with, in no particular order, local and central government and the local and national economies they construe by their actions, which are misdirected and badly informed, but politically correct.

    The overriding effect is still lack of disposable income at all levels in society, which for me results in a lack of custom, resulting from the general placement of the business.

    Local authorities in general roll-over in planning to supermarkets and housebuilders per-se for the promise of a set of street lights, a roundabout, some arts funding, some educational funding... the employment issues, miss the point of the essentials of a local economy and go blindly on to receive their contentious pension rights, after homogenising all around them and indirectly rubbing out the small businesses they seek to promote via an emasculated business gateway.

    Local authoritites and their out of touch service provision create an expensive and poorly maintained built environment for the majority of small businesses to trade in (At least in my region.) are unaccountable and complacent.

    Gross this up to the national level and we are about in the same set of hands with similar effect. Who is currently lobbying for what on behalf of the large "grocery" retail multiples? Who funds what politically? On a whole host of market share measures supermarket plcs are too large and should be broken up. Take the BAA broom to them!

    Who has made a complete fandango of the national economy, the financial system of monetary exchange and brought the economy to a standstill? Not Tesco, that's for sure.

    Shame on you at number 10, you are making life very difficult at the moment. Do something os substance with the remaining term.

    The environment local and national government has created for businesses and private individuals to inhabit is arduous on a plethora of social, economic and moral levels. It is a good job there is no performance related element to these occupations in evidence.

    The only common theme I can discern is organisation in the face of apathy. The organised are having it over the apathetic and the meek, by the way, get sfa.

  • Comment number 65.

    A lot of people are missing the point in this recession. With all the mergers and acquisitions that will take place in this 'cheaper' environment and the Government being prepared to waive Monopoly and competition law in order to support this - you will end up with fewer, larger companies.

    This is NEVER good for the consumer, you only have to look at the early days of the privatised industries (BT, British Gas etc) to see how the consumer gets screwed over.

    It's also highly wasteful, Tesco might rely on the Economies of scale for it's efficientcy improvements, but the food wastage and fuel wastage (to transport the food) is phenomenal.

    I have learnt a lot of surprising things about the people of Britain over the last few weeks. A lot of people feel they want to be 'controlled', told what to do, what to buy, what to wear etc. as they seem to welcome the standardisation of food sales into on single or a few vendors.

    Sadly this is not how everyone wants to live, and until you have grown your own veg and compared it to the watery cheap and nasty veg Tesco sell - then you will never understand. We are being sold sub-standard food in the drive for 'cheap living' - and the Government womders why there's an obesity problem?

    You can't allow supermarkets to become so powerful they dictate the direction of the market at the expense of your citizens health (well not if you have any morals you can't)

    Tesco are not a good thing - no oligopolistic market is good for the consumer.

    There are big worries about the increase in the non-working population through age - how productive will an obese society be? what will be burden be like on the few tax payers left who are supporting an aging and a fattening population?

    Ah well, I suppose as long as they are making MONEY then it's OK - right?

  • Comment number 66.

    #58 Horned_devil

    I'm afraid you are inaccurate, the farmers did not choose to get into bed with Tesco - Tesco obliterated the competition to ensure the farmers had that classic free market choice "work for less - or starve to death"

    Nice choice to have.

    Don't believe me? Where has your local greengrocer / butcher / fishmonger gone then?

    They were the customers and Tesco have annexed the lot with their undercutting of prices and refusal to deal with suppliers unless they get exclusivity.

  • Comment number 67.

    Sorry, haven't had time to read all Tesco comments yet but has the following been picked up. Tesco claim to be expanding overseas - up to 30% of the their activities are in non Sterling areas. Presumably they have consolidated group accounts. If so the rapid collapse of the pound in late 2008 when converted from US Dollars or Euros would boost the group profit. The problem with that game is that when it is the turn for the pound to go up and for the others to go down then UK based global businesses will be in yet another pickle.

  • Comment number 68.

    66

    Agreed Tesco did obliterate the opposition. I have a local greengrocer/butcher etc - would love to shop there - however they are only open 9-5 and a couple of hours on a Saturday morning. I work during these times and therefore cannot shop with them - Tesco's (or the other evil supermarkets) open the hours that I can shop. Tesco's have obliterated the local sellers by offering me, the consumer, what I want (eg to be able to go and buy my food at a time that is convenient for me).

    Tesco obliterated all of this competition by offering what their customers want. There still exists farmers markets, farm shops, local shops and greengrocers but people don't shop there - partly to do with my point above but also to do with price point (people are willing to allow Tesco's to squeeze the suppliers as long as its less out of their pocket) and time constraints (despite all the new technology which should supposedly give us more free time we have less free time than ever and so want to just get everything in one place).

    I'm not arguing that we are better off because of the oligopolistic markets that we are in (look at other industries where this has led to things getting worse - banking and transport to name two) but that it isn't just Tesco's being big, bad and evil but us as consumers choosing to make the market like so.

    I do agree with your point above though about the quality of the produce - sadly when I shop at the big stores I see more people in the ready meal section than the fruit and veg - again pointing to the "lack of time" we all feel we have (ps. I am starting to grow my own veg so hopefully will soon fully appreciate the difference)

  • Comment number 69.

    Psst...no-one mention the American lemon, Fresh Out Of Cash, that Tesco has created......

  • Comment number 70.

    Good show Tesco! Presumably a "pre-tax" profit of £3.1bn means Mr Leahy will be paying corporation tax at 28% of £868m into Mr Darling's empty coffers. Or doesn't it work like that?

    And in similarly curious vein, if the IMF is right that the banks, insurers and other corporate heroes have lost $4trillion, who has won it and what have they done with it? I understand that banks lent mortgages of $250,000 to allow people to buy the static caravans that ultimately turned out to be worth $5000, but someone sold the trailer in the first place and surely ALL of the money can't have been spent on plasma TVs, Range Rover Sports and handbags.....

  • Comment number 71.

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

  • Comment number 72.

    #54 - deannakissed

    I could not agree more - only in this country do we celebrate how much we are getting ripped off by applauding the 'great business minds' that achieve it.

    This is where wealth and intelligence part their ways. Anyone could borrow heaps of money from their banker friends, set up a supermarket and use under-hand and devious tactics to eliminate all the smallest vendors and abuse their market position to make huge profits.

    If you look at tesco's business model, it buys stuff that people want, and then make profit on that sale.

    They do it with food, land and soon it will be banking services.

    If you look at what they do over the long term to employment, they destroy it in local produce retailers where employees lead a varied working life, meeting local customers, doing varied jobs within the business - and replace those jobs with monotonus 'shelf filling' or 'till operator' where the reward is only financial (I don't know anyone who works at Tesco for any other reason than money - certainly not for the enjoyment).

    This does not require a 'great business mind' - it merely requires a lack of morals and a couldn't care less attitude towards your fellow man.

    Nice role model for all budding entrepenuers then - and people actually think the thirst for profit doesn't create a self-centred and selfish society?

    If we had any sort of decent Government they would take all the profits from Tesco (and any other company) and use the money to distribute homes to the homeless and food for the hungry.

    Sadly there are too many shareholders who would rather buy another new car than to see this happen.

    Very, very sad.

  • Comment number 73.

    #68 - Horne_devil.

    You still have a butchers! - you must live somewhere posh then...

    I can sympathise with the hours situation, I too have that same problem - but we both know that a steak from the butchers will retain it's size after cooking, whereas one from tesco will shrivel to the size of a bean once all the excess water evaporates.

    The issue of time is one that is impressed on everyone who works. We all rush to work in the morning (creating rush hour), we spend all day there, and then we come home and the day is nearly over - the feeling of time pressure is immense.

    For me the symptom is the feeling of 'lack of time' - the root cause is the demand for profit and the steady decrease of wages in real terms (i.e. not counting for inflation). We have to work longer and harder so that we can keep people like Fred the Shred on his big fat pension - and of course all those ministers in their second homes!

    The answer is simple, we should work on things that need doing - because they need doing, not because there is profit in it. If we did this then I would be happy to staff your butchers on a Saturday morning and in the evening so that you could get some decent meat.

    Sadly this is not possible under Capitalism and until this system goes then we will continue to work harder and longer as the diminishing profit margins are extracted from workers wage packet.

  • Comment number 74.

    I simply can't understand why the Monopolies Commission haven't taken stronger steps to limit Tesco's growth. Their market dominance is obvious and reinforced by these latest figures. They have now reached a point where the consumer is suffering. In New Barnet democracy has been overturned by Tesco's clever (and highly paid) barristers taking Barnet Council to a planning inquiry. They already have 25 stores in our catchment and have proposals for another three within 1 mile of New Barnet. They are happy to buy up sites and hold them derelict for years, helping to kill off the local stores. They then come in and claim to regenerate the area. The Tesco brand now has a distinct Marmite tang!

  • Comment number 75.

    61 Horned devil

    I've done a bit of research. You seem to be right - in a lot of cases.

    I'm now scared to post web links to back up my arguments, since they seem to be what caused the moderators to kill my post in #54.

    So just to say, supermarkets unfair use of their massive clout does seem to be a problem.

    Many suppliers seem to be scared to death of "delisting". The implication of one article I've found is that the discounts are retrospectively inserted into the contract, rather than simply paid retrospectively in accordance with an existing contract.

    Try Googling
    "One leading manufacturer told me" inurl:guardian.co.uk
    for a story which, by implication, supports that interpretation.

    That's also the interpretation I placed on comments such as the following
    1) British Independent Fruit Growers’ Association (BIFGA) are concerned that "British suppliers (through fear of delisting) [might be] afraid to complain of inequitable practices."
    2) "Although the NFU continuously received complaints about the multiples’ buying practices, its members were afraid to supply supporting evidence because of their extreme fear of commercial
    reprisals if specific examples were given."
    (NFU = National Farmers Union)
    3) British Printing Industries Federation "Other problems were the
    frustrations and uncertainties of short-term contracts and constant retendering and contributions to the cost of product launches"

    For all of which (and more), try Googling
    "constant retendering" inurl:www.competition-commission.org.uk

  • Comment number 76.

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

  • Comment number 77.

    And of course there's the question of why the incoming Labour party did not take the lead from the Tories' slow-to-dawn realisation that out-of-town developments are not an unalloyed blessing.

    I hope this link is deemed innocuous enough
    https://www.independent.co.uk/news/uk/politics/gummer-moves-against-outoftown-retail-sheds-1592267.html

  • Comment number 78.

    It's interesting that you haven't mentioned the fact that Tesco Personal Finance is a joint venture with the Royal Bank of Scotland!!!

  • Comment number 79.

    Deflation, Deflation, Deflation................

    Its time for the baker, tailer and candle stick maker.

  • Comment number 80.

    DEFLATION

  • Comment number 81.

    quote "What the figures show is that British shoppers are not partying on the Titanic, but nor are they battening down the hatches, hoarding the cash in the mattress and only eating tinned baked beans"

    it will only show that if ALL the other players have not diminished in there sales too. Which includes more than just the supermarkets. Until then that is a very misleading statement that would verge on spin from the governement to talk up the economy before the budget.

  • Comment number 82.

    The people who work out inflation figures obviously have never set foot in a shop or supermarket. I can,t remember prices increases this bad before at Tesco,s. Most groceries seem to be up 20 to 30%. Beer isn,t too bad but still about 30 to 40% higher than cheaper supermarkets. But spirits OUCH! One of the most popular brands of whisky was on offer 2 litres for £20. Now for a one litre bottle the price is just shy of £20, that,s nearly 100% increase. No wonder Tesco,s are making a fortune. In future I,ll just stick to a diet of digital camera,s and wide screen televisions.

  • Comment number 83.

    Gordon Browns bare face cheeck simply staggers me

    The night before the Budget he suddenly declares that he will clean up the Aegeon Stables of MPs expenses with a "Daily Allowance"

    This will go the same way as teh Lords. Dead men turn up to sign in and bingo they have another £170 pounds a day, no receipt required!!

    I am sure that Brown is becoming Stalin reborn, as he grins at us all through You Tube...

  • Comment number 84.

    #78. groovymrbenj wrote:

    "It's interesting that you haven't mentioned the fact that Tesco Personal Finance is a joint venture with the Royal Bank of Scotland!!!"

    It isn't; Tesco bought out RBS' share almost a year ago. Do keep up. :-)

  • Comment number 85.

    All those who have railed against Tesco and its (supposed) near-monopoly forget that no-one is forced to shop at Tesco. There are, of course, many hundreds of thousands for whom Tesco may be the closest supermarket, but there is always likely to be at least one other supermarket not very much further away.

    I'm not a great fan of Tesco, preferring M&S, Waitrose and the local butcher for my groceries, but there is no denying that Tesco clearly offers people what they want. And that is a good range of relatively cheap food, of reasonable quality, under one roof, at almost any hour of the day that one might wish to buy it.

    Like it or not, Tesco is a success story for British retailing. You cannot blame a company for becoming the biggest simply because people choose to shop there.

  • Comment number 86.

    #79.lionsomebody wrote:

    "Deflation, Deflation, Deflation................"

    But not yet. RPI has not been used as a measure of inflation for quite a number of years now, and it has only reared its head again because it makes a good headline.

    CPI, at 2.9%, is still stubbornly well above the government's inflation target, and is likely to remain there for a while yet.

  • Comment number 87.

    # 85. rbs_temp wrote:

    There may be choice in your neck of the woods, and there certainly is in mine.

    But the the Campaign for the Protection of Rural England (CPRE), who probably have a wider perspective, are concerned about what they call "Food Deserts" where, "due to the absence of effective competition within the retail sector and low levels of mobility, poorer sections of society were unable to obtain high-quality, low-cost food products"
    https://www.competition-commission.org.uk/rep_pub/reports/2000/fulltext/446c15.pdf

    Even allowing that CPRE may be overstating their case, there seems to be a problem brewing which it would be as well to address before it becomes any more major a headache - like we should have done this whole bubble economy business which some think we had for the past decade.

  • Comment number 88.

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

  • Comment number 89.

    Before i forget Mr Preston sir, the BNP have everything they need to know. the full story from start to finish.

  • Comment number 90.

    One of the things we dislike about Tesco and Asda are there self Service checkouts even though the checkout must be a boring job I am sure there are plenty of people on job seekers allowance who would only be to glad of a job on the tills, again this is just another example of the greed of the big retailers, they would rather spend money installing machines to put people out of work, so maximum profits can be achieved never mind the effect on customers I suppose the next thing will be robots stacking the shelves.

    A very Selfish Company

  • Comment number 91.

    Well post #76 clarifies what was upsetting the moderators.

    I mentioned that the market is skewed by the supermarkets' use of land banks and restrictive covenant on land which they do sell. But that's a commonly heard grumble and probably not the problem.

    So it must have been the other thing. And particularly the link to the comments of a Mr. Hoenes on the website of a particularly independent newspaper.

    To try and be a bit delicate, I was trying to point out that although most supermarkets make no contributions to political parties, they do "sponsor political events" (whatever that means). (E.g. In 2007 Tesco gave sponsorship to the Labour Labour Party to the tune of £13,040; the Liberal Democrats got £5,850; and the Conservative Party £5,786)
    - according to https://tinyurl.com/co8tus

    One supermarket also gave £12 million to the millennium dome - when the government was desperate for such sponsorship.

    Against this background, I tried to point out, it is easy to see why some people become cynical, particularly in something as emotional as a planning debate, when the government overturns locally elected officials not to mention its own principles about leaving such decisions to the local authorities except in exceptional cases.

    For example, in one such case objectors lost "in spite of backing from all three tiers of local government - the parish council, South Buckinghamshire district council and the county."
    https://www.guardian.co.uk/business/2005/jan/04/supermarkets.uknews

    Which just doesn't seem right to many.

    Noddingly

  • Comment number 92.

    #90. AverageCit wrote:

    "One of the things we dislike about Tesco and Asda are there self Service checkouts even though the checkout must be a boring job I am sure there are plenty of people on job seekers allowance who would only be to glad of a job on the tills, again this is just another example of the greed of the big retailers, they would rather spend money installing machines to put people out of work, so maximum profits can be achieved never mind the effect on customers I suppose the next thing will be robots stacking the shelves."

    Self-service checkouts are a fantastic innovation, and a lot of customers like using them, even if the software is sometimes a little dodgy. You can't halt progress.

  • Comment number 93.

    92 rbs temp

    Progress for profits sake

    Never mind customer service

  • Comment number 94.

    Is it only me or did anyone notice that ABF a grocers supplier made significantly less profit from its food operation whilst Tesco made more from food?
    We all use Tesco one way or another but there behaviour does get up my nose from time to time for various reasons. The latest being TPF thing, where if you may choose for say extra points bank with Tesco and get extra points for spending that money with Tesco. This to my mind is abitty like the mill owners owning the stores where there workers spent there money. The other one is the demanding of cash riders to position goods and the blatent copying of sector leaders in there own brand products.
    Anyway enough from me I am off to Tesco, Co-op, butcher, deli sweety shop probably in that spending ascending order.

  • Comment number 95.

    one of the best things about technology is that it can reduce the number of boring, mundane jobs - one day, hopefully, it will eliminate them completely

    so, yes, I'd love to see Robots cleaning the bogs at Victoria Station and then popping across to stack the shelves at Tesco ... although I don't go to Tesco, so I wouldn't actually see it as such

  • Comment number 96.

    BBC R4 TODAY John Moulton talking about a long drawn out "L" shaped recession. very good analysis on the subject.

  • Comment number 97.

    #34 there is no chance of the Government trying to restrict the growth of Tesco - after all they are one of the largest sources of donations to Zanu-Labour.

    If the banking sector is anything to go by, it is more likely that Crash Gordon will try to force Tesco to merge with Sainsburys.

    To those predicting that the cost of oil will soon make it impossible for Tesco to import cheap produce from around the world, that may be right but forget any chance of that bringing down Tescos. Their buying power will just allow them to control local sources. As soon as local produce becomes more cost effective than imported, it will be goodbye to farmer's markets etc.

  • Comment number 98.

    As a working mum, I vote with my feet and no longer do my main shop at Tesco's. I don't believe in giving too much power to one supplier. The co-op is good, open when you need it, including Sunday evenings, ethical and provides lots of 'local' shops so it's still possible to 'walk'!

    I had a shock about 15 yrs ago when I first went to the US, and found it was almost impossible, and frequently dangerous, to walk to any food store. Plenty of roads, plenty of parking...but no footpaths! Is this where we are heading in the UK! I truely hope not.

 

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