Efficiency or Idiocy?

For some time it has been apparent that Dave Lewis has been determined to address the ‘bloat’ in Tesco and cut back on all sorts of things.  In the big picture out have gone most of the diversifications of the previous regime, replaced by a focus on the core business.  The store portfolio has been hacked at the edges, though there remain concerns over the estate.  Within the stores, the excessive range has been chopped back, with more to come.  The result, and it seems to be working, is a sharper, leaner business providing more offer/value to the consumer.

Tesco counter closures

It was announced a little while ago that in some stores the next target was to be the counter service offers.  So the recent announcement in our local Stirling store (see photo) was not a total surprise.  The closures and limited hours means a chunk of real estate in the store is not going to be used, but more importantly some consumers are going to be dissuaded from visiting.  So, at what point does copying the competition and efficiency gains at all costs become a spiral of consumer dissatisfaction and behaviour change?  Where is the tipping point for some consumers?

Stirling is not a hot-bed of quality butchers nor does it have a fishmonger, so the alternatives are a little limited (though Bridge of Allan and Dunblane are well served), but perhaps others, hopefully an independent, will fill the gaps.  It is noticeable that at the Stirling Farmer’s Market the fishmonger does very well.

A photo update from 25th May – really, what are they trying to achieve here?

Tesco counters 1Tesco counters 2Tesco counters 3

 

 

Boots bags

Efficiency was also the theme of the second story that caught my eye this week.  At a time of national discussions of climate emergency and a fervour among many citizens and consumers about environmental matters large and small, Boots rolled out plastic bags for some prescriptions.  This, at this of all times, is genuinely jaw dropping.

The explanation, such as it was, for such a change was that of handling and distribution efficiency. Plastic is better handled in central sites and lasts longer (yeah!).  This may be true, but is utterly irrelevant when your consumer base is going in completely the opposite direction.  How many people across the business were asleep at the wheel?  This smacks of a business out of touch, with itself and the country.

 

And finally, talking of out of touch, it was proposed this week that a penny tax on all self-checkout transactions should be levied to ‘heal the generational divide caused by Brexit’.  Where to begin?  This is barking mad at so many levels.  It fails tests of practicality, reasonableness, awareness, effectiveness amongst so many more.  What are these people thinking and why are people so out of touch so close to “power”

 

CHUK

About Leigh Sparks

I am Professor of Retail Studies at the Institute for Retail Studies, University of Stirling, where I research and teach aspects of retailing and retail supply chains, alongside various colleagues. I am Chair of Scotland's Towns Partnership. I am also a Deputy Principal of the University, with responsibility for Education and Students.
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8 Responses to Efficiency or Idiocy?

  1. Shop at Morrison’s of Bradford as they used to be called. Interestingly they gave real strength in their butchery and bakery supply chain, a legacy of their Northern roots.

    • Leigh Sparks says:

      What’s more it offers then a point of difference to the mainstream competition

    • Christine Reeves says:

      Our local Tesco has also seen the closure of the fresh food counters and as a result has lost what makes it different from its various competitors which are numerous. Already the store feels different- it has lost its personality and the ‘displays’ in front of the counters are off-putting. I was a loyal Tesco shopper but even I am looking elsewhere and I know from other customers I have spoken to I am not the only one. The counter closures may have been necessary in some stores but I don’t think enough consideration has been given to individual store situations.

      • Leigh Sparks says:

        Christine, Agree entirely. But it is also not just considering the individual store situations, but the way it has been done that seems poor to me,. It is just such a bad look in so many stores. I was in South Wales last week and it was the same in the stores I went in there..

  2. Mark Barratt says:

    Leigh,
    Are Tesco’s cuts based on store demographics, or everywhere in the UK?
    As for Boots, is this the American influence, where cost comes before sustainability, or are they simply reverting to more of a cost mentality?
    Regards,
    Mark

  3. Leigh Sparks says:

    Mark
    The Tesco cuts are across the UK as far as I know, but not in every store (again as far as I know) i.e. they will have done analysis and used the Clubcard I suspect to see where they should make such cuts. They will have modelled some impact but it does rather depend on the tipping point for some consumers. I know other local Tesco stores have similar closures and others have mentioned other places.For me they lose a point of difference which I fear may not be a good thing and may be the beginnings of a slippery slope.

    No real idea on the Boots origins. It seems to be a distribution efficiency for the central served prescriptions.It could be costs but it could equally be the state some paper bags were arriving in at the customer through this system.

    Leigh

    • Mark Barratt says:

      Leigh,

      After leaving the US in 2002, it is good to hear your perspective.
      Kind regards,
      Mark

  4. Pingback: UK Grocery Market Share 1997-2019 | Stirlingretail

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