Tesco's cooked books show how much supermarkets have lost the plot

llamedos · Oct 8, 2014

Opinion Piece By Chris Rundle.

Troubled times indeed – and far more troubled, apparently, than they would have you believe – at Tesco and Sainsbury's, now both paying the price for ignoring obvious warning signs such as the removal of tens of billions of pounds from the nation's spending power by virtue of massive benefit cuts.

Which is what, presumably, lies behind the latest initiative at Sainsbury's to whip its hapless staff into greater and greater efforts to extract additional cash from shoppers' pockets.

A poster reading: "Fifty pence challenge – Let's encourage every customer to spend an additional 50p during each shopping trip between now and the year-end" was destined for the staff room at a Sainsbury's in Stratford, East London, but was dimwittedly posted in the window instead.

Once the blunder was noticed it was rapidly whipped down, with Sainsbury's airily dismissing it. "We often use posters to make store targets fun and achievable for our colleagues," it gushed – a statement somewhat at odds with the blistering dressing-down most supermarket managers can expect if targets are missed.

And for more on #FatCats & the RSPCA

: http://www.westerndailypress.co.uk/...ory-23058808-detail/story.html?#ixzz3FXVSmBFE

jade35 · Oct 8, 2014

His comments on the 'ghost of Tesco past' certainly made me smile

I assume they went past the legal team

joe soapy · Oct 8, 2014

Good to see Chris Rundle giving Ian Johnson a kindly mention.
He has given some good interviews over the last few years and been a good spokesman for the farming community.
Will be sorely missed

Walterp · Oct 8, 2014

llamedos said:
Once the blunder was noticed it was rapidly whipped down, with Sainsbury's airily dismissing it. "We often use posters to make store targets fun and achievable for our colleagues," it gushed – a statement somewhat at odds with the blistering dressing-down most supermarket managers can expect if targets are missed.

As an aside, I'm not sure how much posters know about the conditions under which retail managers work - 'high pressure environment' just about sums it up, with regional managers constantly measuring your, and your store's, performance. It's not particularly well-paid, but is both stressful and demanding.

Anyone here work for Tesco's?

bobk · Oct 8, 2014

Walterp said:
.

Anyone here work for Tesco's?

We all work for one of the big 5 if you're a producer .

jade35 · Oct 22, 2014

From the DT

Tesco brand 'severely compromised', say shoppers
Tesco’s brand in the UK is “severely compromised” with customers becoming increasingly disillusioned with the service at Britain’s biggest retailer, according to a detailed new survey of shoppers.

The company has the lowest overall customer satisfaction metrics in the grocery industry and its brand is “tarnished”, research by specialist advisory firm Lazarus has claimed.
http://www.telegraph.co.uk/finance/...and-severely-compromised-says-new-survey.html

21/10/14
Tesco
179.3p+4.75p
Questor says SELL

TESCO [LON:TSCO] shares, unlike most of the goods on its shelves, are half price at the moment after a disastrous 12 months.
http://www.telegraph.co.uk/finance/...-share-tip-Tesco-shares-are-uninvestable.html

21/10/14
Tesco sales are falling at the fastest rate in the grocery industry as the rise of Aldi and Lidl and the supermarket price war take their toll.

Sales for Britain's biggest retailer dropped by 3.6pc in the 12 weeks to October 12, reducing its market share from 30.1pc a year ago to 28.8pc, according to Kantar Worldpanel.

Analysts at HSBC said that it could cost £3bn to turnaround Tesco in the UK. This would involve lowering prices by 5pc to 6pc, increasing the number of staff in stores by 20pc to 25pc, and investing £500m to £1bn in improving the quality of food.

http://www.telegraph.co.uk/finance/...esco-sales-worst-in-the-grocery-industry.html

cudota · Oct 22, 2014

Looks like Tesco going to have to do as they have made farmers do ...work harder for less money....Lets see if it works for them .....every little helps

Blod · Oct 22, 2014

Do you think the government will consider bailing them out of it get's truly dire?

JCA · Oct 22, 2014

If they say a business is in trouble because it only has 28% market share and sales have dropped a massive 3.6% in a year, they better not look at my sales sheet!

Yale · Oct 23, 2014

I think Tesco now should understand why customers can only have the wool pulled over their eyes for so long.

Profits down 90 odd percent.

It's like being a farmer.

As just said on tv customers cottoned onto 'Every little helps..................Tesco.'

llamedos · Oct 23, 2014

Worth a listen You & Yours yesterday afternoon http://www.bbc.co.uk/programmes/b04lsl29

Cowabunga · Oct 23, 2014

jade35 said:
From the DT

Tesco brand 'severely compromised', say shoppers
Tesco’s brand in the UK is “severely compromised” with customers becoming increasingly disillusioned with the service at Britain’s biggest retailer, according to a detailed new survey of shoppers.

The company has the lowest overall customer satisfaction metrics in the grocery industry and its brand is “tarnished”, research by specialist advisory firm Lazarus has claimed.
http://www.telegraph.co.uk/finance/...and-severely-compromised-says-new-survey.html

21/10/14
Tesco
179.3p+4.75p
Questor says SELL

TESCO [LON:TSCO] shares, unlike most of the goods on its shelves, are half price at the moment after a disastrous 12 months.
http://www.telegraph.co.uk/finance/...-share-tip-Tesco-shares-are-uninvestable.html

21/10/14
Tesco sales are falling at the fastest rate in the grocery industry as the rise of Aldi and Lidl and the supermarket price war take their toll.

Sales for Britain's biggest retailer dropped by 3.6pc in the 12 weeks to October 12, reducing its market share from 30.1pc a year ago to 28.8pc, according to Kantar Worldpanel.

Analysts at HSBC said that it could cost £3bn to turnaround Tesco in the UK. This would involve lowering prices by 5pc to 6pc, increasing the number of staff in stores by 20pc to 25pc, and investing £500m to £1bn in improving the quality of food.

http://www.telegraph.co.uk/finance/...esco-sales-worst-in-the-grocery-industry.html

Guess who's income will be pressurised to achieve their cost reduction. Their local staff and their suppliers of course. You and me. Apparently the quality and price of their food is substandard according to the above. As their suppliers, we should be very worried. Their staff should be even more worried.
At least there is a hint that they will not rob their suppliers in future. But until very recently they categorically denied ever doing so, so I'm not holding my breath and wouldn't trust them further than I could throw them. Remember that Mr Tesco is only worried about one thing, and current events prove and re-enforce this, that the one thing is Tesco profit. They have shown no loyalty or responsibility or even honesty towards their suppliers.

Walterp · Oct 23, 2014

Cowabunga said:
Apparently the quality and price of their food is substandard according to the above. As their suppliers, we should be very worried. Their staff should be even more worried.

Tesco's beef has been crap eating quality for several years, at least - all those big, Blue, carcasses coming back to bite 'em in the arse.

Other chains (Morrison's, Lidl, even the small local players like CK's) know perfectly well that prime beef needs to be quality stuff, and that the price of that has to go up (to reflect compromised supply) not down.

Let's face it - prime beef can't go down. What're they gonna do? Import it?

jade35 · Oct 23, 2014

The change in people's shopping habits may also have an influence. Bear in mind that the report was commissioned by Waitrose, but it may still be the way more people are thinking and shopping.
http://www.telegraph.co.uk/earth/ag...9605/Are-you-a-middle-class-food-shopper.html

Cowabunga · Oct 23, 2014

Walterp said:
Tesco's beef has been crap eating quality for several years, at least - all those big, Blue, carcasses coming back to bite 'em in the arse.

Other chains (Morrison's, Lidl, even the small local players like CK's) know perfectly well that prime beef needs to be quality stuff, and that the price of that has to go up (to reflect compromised supply) not down.

Let's face it - prime beef can't go down. What're they gonna do? Import it?

You are quite correct that their beef has been terrible for a long time. It is probably down to how they manage the carcasses, but I'm no expert on this.

What is very noticeable locally is that for the past 12 months, their Cardigan store has gone noticeably downhill. It is often out of stock of some products, the total stock seems less on the shelves, it is less polished and more noticeably less well maintained and customers are voting with their feet. The formerly packed car park has obviously more empty parking spaces at any time.
People aren't daft. Or they aren't daft for long. It can't be the price that pushes people away from their local store as, apart from a small Aldi store down the road, they killed off most of their local competition long ago. It looks like Morrisons in Aberystwyth is as busy or busier than ever and are gaining at Carmarthen.

The really notable large Tesco store that always amazes me is the one at Newtown. It is like a desert, seemingly not supported by locals at all. It is the least busy supermarket and emptiest car park that I know of. Something is very badly wrong there and, since it has had every chance, it is one branch that I would suggest that must be running at a loss with a question mark over its future viability.

https://www.google.co.uk/maps/@52.5...ata=!3m4!1e1!3m2!1sY20owJ-uQJQESgboQNmelQ!2e0

Jock · Oct 23, 2014

jade35 said:
The change in people's shopping habits may also have an influence. Bear in mind that the report was commissioned by Waitrose, but it may still be the way more people are thinking and shopping.
http://www.telegraph.co.uk/earth/ag...9605/Are-you-a-middle-class-food-shopper.html

Interesting report that.
Bit about no more big weekly shop, meal kits, and frozen products could also explain why potato job has been so bad for growers this past couple of years.

Doesn't really explain the move from Tesco to Aldi/Lidl though. Think that's more just a case of people wanting to buy on best price and not have to trawl through BOGOF deals, use their clubcard discount tokens or get fuel discount vouchers to find it. Tesco became too smart for their own good in taking people for mugs and it's finally caught up with them.

Welsh Farmer · Oct 23, 2014

.... plus that latest advert for Lidl on the tv at the moment is very slick and clever ... very slick and very good indeed imo. It's really aimed at appealing to the middle-class target customer and removing the lowly, budget-conscious image Lidl has so long had; As adverts go it's an excellent advertising campaign.

Cowabunga · Oct 23, 2014

I believe that the customers moving to Aldi and Lidl is exaggerated. A 40% increase from bugger-all is still near bugger-all if you see what I mean. All companies go through phases and need to reassess their strategy now and again. Fact is, Tesco are not discounters and neither are they luxury suppliers. They are in a very fiercely competitive market and they have lost the plot somewhat. When you are top, there is nowhere much higher to go and it was always unrealistic to expect ever higher growth and margins when there are so many hungry competitors wanting a slice of the action.

I agree about the Lidl adverts being clever. It encourages Lidl brand recognition while breaking loyalty to known and hitherto trusted food brands. Not sure whether that is a 'good thing' from UK farmer's perspective.

Welsh Farmer · Oct 23, 2014

I think from the producers / growers perspective it is a good thing because Lidl do offer the flexibility of entering in to local grower supplies.

Completely agree with @Cowabunga take on no where to go when you are at the top .... but Tesco bosses should have realised this and concentrated on maintaining their pole position with good customer service, fairer returns for farmers etc etc (you all know the type of things I'm on about) but they lost sight of this in their two-fold quest of global domination and spending too much time watching competitors outside of their organisation (over and above what they should have). Take your eye off your own business AND trying to widen your area of expertise massively outside what you are known to be good at PLUS not paying attention to the early warning signs given by customers is a recipe for disaster in any business. I've very little sympathy for Tesco because they were guilty of all three.

FarmyStu · Oct 23, 2014

It often seems to me that most farmers are on the wrong side of the debate as far as food consumers are concerned. There's never a shortage of farmers on here or elsewhere in the media demanding more for their produce; Stating that consumers must realise how much it costs to produce food and must be prepared to pay more for it.

How have consumers reacted to this advice? By leaving the satan that is Tesco and going to shops where food is EVEN CHEAPER!

Why don't FFA and the like set up their own supermarket. Pay farmers whatever it is that farmers think they would like in order to make a "fair" profit. Then charge a price in the supermarket that makes a "fair" profit for the supermarket as well. Not forgetting to pay the staff a "fair" wage. Non of this minimum wage nonsense. So the food shopper would pay lots more for their food but wouldn't mind as everyone was making a "fair" profit. I can imagine the ques to get in such a supermarket now..........

Tesco's cooked books show how much supermarkets have lost the plot

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