Tesco’s profits have fallen by 1% – the first drop in twenty years, and Philip Clarke, its CEO, has been getting his pretty face in front of the cameras today to publicise his £1bn recovery plan.
He’s also been reassuring us all that Tesco aren’t “struggling” – phew! £4bn in profits can hardly compare to the struggles faced by our independent food stores to stay open and keep fighting their David & Goliath battle with Tesco and the other major supermarkets.
It’s no secret that at hiSbe we’re not the biggest fans of supermarkets, they’ve been sucking the goodness out of our food system for decades, whilst forcing themselves on communities, squeezing producers and farmers, and operating in ways that are so far from our ethos of business “how it Should be” that it makes our blood boil.
But Mr. Clarke tells us he wants to put the “heart and soul back into Tesco”. Which is fantastic news, because at hiSbe we miss the good old days when it was a socially conscious business that cared about its suppliers, producers and farmers, stood for something other than making its major shareholders revoltingly rich, and recognised its responsibility for feeding its customers nutritious, real food produced in nondestructive ways.
Hang on, it’s never been like that; they’ve ALWAYS put their profit before people, animals and the planet, that’s why after almost 40 years of supermarkets our food system is in the state that it is.
So what on earth is this “heart and soul” that they’re putting back? They sold their soul a long time ago, along with their grandmothers – but anything to boost profits, that’s just “business” right?
At the moment Tesco have around 2700 stores in the UK, as Zoe Wood from the Guardian says, it’s these stores that have been the “cash cow” that has made Tesco’s overseas expansion possible – British people’s hard earned cash being used to extend Tesco’s “values” to the rest of the world, wonderful.
But back to the UK – 2700 stores, and more on the way! However, the throwing up of new stores is slowing down – as the Financial Times puts it, Tesco is “reigning in its relentless expansion of physical stores”.
That’s something to be grateful for then, shame it’s in response to falling profits and not as a result of listening to the communities across the UK shouting at them that they’re not wanted.
Yes, they’re only going to open up a third of the new stores that were planned, with most of those being the convenience-sized stores. They’ll also spend some of that £1bn recovery plan money on expanding their “Express” outlets, which is all pretty bleak news for our struggling independent retailers and local economies. As long as Tesco isn’t struggling though, that’s the main thing.
Inititally they will refurbish 430 stores, to “make the UK shopping trip better for customers” – but we just wonder about all the energy, water and resources that will be required to make their stores look “warmer and less-functional”, and how many tonnes of waste will be heading off to landfill afterwards.
High Streets (what’s left of them) can breathe a shallow sigh of relief though; they’ll be no new out-of-town Tesco hypermarkets for now, they’re just going to spruce up the existing ones. Although with Philip Clarke predicting the chain still has “decades of growth” ahead to enjoy, and believing that the demise of the hypermarket is still “a very long way in the future”, our high streets may yet have their last breath squeezed out.
They’re also planning on completely overhauling their own brand food ranges, which represent a staggering 40% of all UK food sales. They’ll use all the clubcard data they collect on customers to tailor their offering to the ethnicity and affluence of people within each store area. Would we be cynical in surmising that this translates to further editing of choice, and providing even lower quality food to poorer neighbourhoods?
Of course the 8000 jobs that are part of the plan are good news, particularly after all that unfortunate PR around the Workfare scheme. Maybe they’ll employ the five hundred Dairy Crest workers out of a job after yesterday’s announcement that Tesco have cancelled it’s contract with the Group because they can squeeze a better price elsewhere. Meanwhile, the other 7500 jobs might just cover the amount of dairy farmers that have been forced out of business as a result of the supermarkets’ price war on milk.
Philip Clarke wants to “build trust in our pricing”, but that could only really happen with a fully transparent price system, which would show just how greedy they are, and how little of each pound spent with them reaches the people who are responsible for investing their lives growing and producing our food.
Mr. Clarke finished his interview with this final sentence “The business continues to grow, and continues to deliver for shareholders”. That’s all it’s about really, they don’t care about the customers, they just care about their cash – but your local grocer / butcher / baker / fishmonger knows his customers and values more than their money.
As a shopper you vote with your feet and your wallet – every pound you spend with a retailer is an endorsement, a big thumbs up to the way they do business and a powerful demand for more of the same. Make sure you’re voting for business how it Should be.