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3.2 Tesco In 2005 Tesco Achieved Sales Turnover Of £37.1 Bill. And Profits ...


3.2 Tesco
In 2005 Tesco achieved sales turnover of £37.1 bill. and profits of £2,029m. Profits and sales have grown consistently over the past 5 years. Profits from 2004-5 grew by 20.5% on sales growth of 12.4%. The company employs 360,000 people worldwide and has 2,000 stores. 111 new stores are planned for 2006.
Its long-term strategy is based on four parts:
growth in the core UK business
expansion from international growth
to be as strong in non-food as in food
to follow customers into new retailing services
Tesco appears to take customer focus and staff focus very seriously. An ongoing project entitled Every Little Helps is in process which has used question times with more than 9,000 customers to help them to understand how they can best improve service to customers on a day-to-day basis. This has resulted in parking bays for trolleys (to stop annoying customers), extra staff on checkouts (to reduce waiting times) and fresh food counters and self-service cafes for customers in a hurry.
Using their Clubcard as the data source Tesco send out mailings every quarter to 11million customers. The mailings have an annualised value to customers (if they use them) of £250m. and can be adjusted to take account of individual customer buying behaviour.
Tesco has a range of different stores in line with its belief that:
Customers have different needs at different times so we tailor our stores as well as our products. From Value to Finest and from Express to Extra, there's something for everyone at Tesco.
Value products are low-priced basics for customers on a tight budget. Finest are products with the finest ingredients for customers who appreciate fine food and are prepared to pay higher prices for higher quality. Express are smaller stores in local communities for people who would find it difficult to get to a large Tesco store. Metro are stores in town and city centres for the convenience of customers who prefer to shop in town rather than in the Superstores out of town. These Superstores are particularly for one-stop shoppers who can find everything they need for their weekly shopping. They carry not only a wide range of food lines but also the most popular Tesco non-food lines. Tesco Extra is a major new development focusing on non-.food lines, but with extensive food and convenience lines. As only 20% of the UK population has access to such stores Tesco intends opening 20 more this year.
For all health-conscious customers (viz. the struggling idealists in 2.3) Tesco has introduced better labelling, diet guides and Free-from and organic ranges.
For price-conscious customers who also like good service they have introduced the Step Change programme and Everyday Low Pricing.
For the growing number of customers who prefer to order from home and get home deliveries Tesco provides an on-line service which now supplies 150,000 customers/day.

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