Tesco is the UK’s largest retailer and one of the world’s leading grocers.
With UK sales of £52.37bn, it leads the grocery market with around 27% market share and dominates online, where it has first-mover advantage and around 35% market share. In response to huge customer demand amidst the pandemic, it doubled its online deliveries to reach 1.5m per week but these have now normalised at around 1.1m per week.
It also has sizeable businesses in non-food areas such as homewares and clothing.
Tesco completed a five-year turnaround in early 2020 and has been radically reshaped to allow it to thrive once more, rediscovering its identity, its proposition and reconnecting to the modern consumer. Boots lifer Ken Murphy has been at the helm since October 2020 and set out a vision based on value, customer loyalty and growth of its digital platforms.
Tesco has achieved over five years of sales growth but is now a much smaller business as it reduced its footprint to focus on its core business in the UK and Ireland. Tesco has sold off a large number of non-core and international subsidiaries in recent years including its grocery operations in Asia, Turkey and Poland and its Giraffe, Euphorium Bakery, opticians and Dobbies garden centre businesses in the UK.
To expand its reach in the UK Tesco merged with Booker, the UK’s leading food wholesaler, in a £3.7bn deal in 2018. Booker owns symbol groups Londis, Budgens and Premier and has both retail and catering distribution activities.
Sustainability is high on Tesco’s agenda. It is working to a plan to generate 10% of its own electricity by 2030 and to achieve net zero emissions by 2050 and carbon neutrality in its own operations by 2035. At the same time it is working hard to improve diets, reduce waste and eliminate plastic from its stores and own brand packaging.
Innovation rating: 3.5