The supermarket group has ambitions to open at least 150 convenience stores – a 50 per cent uplift on the 100 it was scheduled to open in the financial year just ended.
The revelation will pile pressure on Tesco’s convenience store rivals, such as Sainsbury’s, Spar and the Co-operative Group.
Tesco declined to comment ahead of unveiling likely record sales and profits in its preliminary results on Tuesday.
The world’s third-biggest grocer has about 810 Tesco Express stores, so an additional 150 would bring the chain’s storecount to just shy of 1,000. Tesco also runs 500 One-Stop convenience stores, a legacy of its launch into the neighbourhood retailing market in 2003 with the acquisition of T&S.
Blue Oar analyst Greg Lawless said: “When you put it [the target of 150 Tesco Express] against what Sainsbury’s is doing, it is in another league.” Sainsbury’s plans to open about 100 convenience stores over the next three years.
He added: “If they are ramping it up, clearly they believe they have got something they can accelerate. The economics of it are pretty compelling. They are bringing it to the suburbs and I am sure it is highly profitable.”
Broker JP Morgan expects that Tesco will deliver an 11 per cent increase in pre-tax profits to a record£2.65 billion next week.
Analysts will also be keen to hear how Tesco’s US venture Fresh & Easy is progressing. Broker Citi believes that Tesco may disclose the US results within the UK figures, which cynics could use as evidence that the chain has struggled since its launch last November.
No comments yet