A few weeks ago the “feel” of the university changed dramatically as the undergraduates and new postgraduates descended for the new semester. A sure sign Christmas is round the corner.
There are always plenty of students around in the summer – postgrads doing dissertations and projects and various summer schools and other classes (not the bagpipe school again – please). But the new semester with brand new first year students marks a changing of the seasons.
For some reason I was thinking of this when the Tesco interim results came out last week. The Tesco machine has spluttered in the UK in recent years – if still having a market share in food of over 30% can be called a splutter. Sales have been lacklustre (they are not alone in this), but market share has edged down.
One other plank of the this #1 takeover was of course the purchase of Willie Lows (if you are one of my students you will have to ask your parents who they were) from the jaws of a Sainsbury takeover. Outbidding Sainsbury seemed rash at the time. but it made Tesco truly national (UK) for the first time and catapaulted upwards their previously limited market share in Scotland. if Sainsbury had held their nerve and outbid Tesco, how much would have been different in Scotland today?
A few other things caught my eye in the Tesco interims:
- 65% of floorspace is now outside the UK
- 49% of stores are now outside the UK
- 34% of sales are outside the UK
- 28% of profit is outside the UK
Tesco is truly international and increasingly reliant on its internationalisation for growth.
And in the UK? Much noise about The Big Price Drop, which for me is a rebalancing of approach. One of the lessons of the Sainsbury fall from grace was the way in which they got so out of line in consumers’ eyes on price. Tesco are determined not to do the same thing. Operationally they remain powerful.
One other snippet – between February and August 2011, Tesco added 150 stores to their UK portfolio, of which 142 were smaller than 3000 sq ft. Yes, some were One-stop, but even so.
Given this rate and format of development and Tesco’s ubiquity, it’s no wonder my students can not imagine anyone else being at #1. And yet, we said this about Sainsbury, once upon a time. Complacency in retailing is very dangerous – something Tesco are well aware of.