I think they’re in trouble. Well, I say trouble. Tesco announced profits of £3.7bn in the UK this morning so they’re hardly in shit. More than we made last year.
That said, shareholders aren’t going to take too kindly to days when the share price drops 16%.
The headlines say the supermarket's Christmas campaign failed to entice shoppers into store. This won't be a marketing issue, but an operational one. This is a company that is massive, bloated and listless. Its non-food businesses have done bonkers numbers in the last few years, and now occupy enormous acres of floor space. The shrinking core food business retracts apologetically, literally in front of the eyes of customers.
Its massive bloatedness and no doubt hideous bureaucracy, will be hampering clear thinking and communication. Its nearest and dearest rivals remain crystal in the conscious of the public. ASDA – price. Sainsbury’s – value. Waitrose – posh. Lidl/ALDI – cheap. Tesco? Huge and "I don’t know where everything is."
For a large of the population that’s the level of decision-making as the keys go into the ignition.
You've got to feel for CEO, Philip Clarke - the Wilf McGuinness to Sir Terry Leahy's Matt Busby. They’ve got a few issues in there, and they're not going to be fixed in a quarter.
Pic: MrLomo/Flickr
Comments