Tesco to focus on smaller stores
Tesco is expected to announce that it will be reining back its expansion plans when it announces its full year results this week.
The supermarket giant is understood to be refocusing on its existing store portfolio and its Express convenience chain instead of pursuing the development of large out-of town hypermarkets. It is also looking to extend its click-and-collect service for customers shopping on its website. The service is currently only available in around 500 Tesco's 2,700 stores.
Tesco is also expected to announce that it will make its stores warmer and more inviting through a store refit programme and invest in higher quality fresh and packaged food in an attempt to woo customers. The company has already said that it will create 20,000 new jobs over two years to improve its level of customer service.
This new approach follows the issue of Tesco’s first profit warning in more than 20 years back in January which wiped £5 billion off the share price. Tesco chief executive Philip Clarke said at the time: "Do you really need to build large hypermarkets in the UK when the internet is taking so much growth in electrical, in clothing, in general merchandise?"
Last week Tesco announced that it is reviewing its £110 million brand communications account which is currently held by Red Brick Road. The agency, which has held the account for seven years, said it intends to re-pitch for the business.
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