It's difficult to be ambivalent about the British supermarket giant Tesco: people either love it or hate it. Shoppers have been flocking there, as its latest results show. But the store has many critics who complain about its "junk food" and its dependence on food imports instead of local, and fresher, supplies.
Tesco has revealed it is on course to meet market expectations of ?2 billion (US$3.74 billion) profits for the current year, but it went out of its way to steer analysts away from even higher expectations.
With good reason: Tesco, with just under 30 percent of the UK grocery market, accounts for ?1 in every ?8 spent in UK shops. Its expansion has been sensational, but there are limits -- although the financial markets just love pushing expectations to the limits, so much so that Tesco's shares fell 2.9 percent on Tuesday after confirmation of strong sales and profit figures.
Far from "hyping" their results, Tesco executives are doing their best to play them down. Thus finance director Andrew Higginson has been trying to divert attention from the "near 30 percent" market-share figure to 18 percent, which he says is the Tesco proportion of all food sold in the UK, as opposed to combined supermarket and grocery sales.
"We didn't want people to get too enthusiastic," Higginson told the Financial Times. Earlier Tesco's chief executive Sir Terry Leahy had told the Observer newspaper that "size is a mixed blessing" and warned "size does not give you automatic protection from competition."
Tesco chiefs are clearly concerned that their commercial success will attract accusations of "monopoly" (traditionally any company with a third of the market is considered to have a monopolistic dominance which is inimical to competition).
However, they are well aware that Tesco itself was once considered a down-market poor relation to companies such as Marks & Spencer and Sainsbury, each of which was as fashionable in its day as Tesco is now, only to fall out of favor. Thus in the corridors of power in London, where under New Labour businessmen are considered to know all the answers, some officials look with envy at Leahy.
"He would be just the man to sort out the immigration service" said one this week.
Old hands recall, however, that, when Marks & Spencer was the flavor of the decade in the 1980s, then prime minister Margaret Thatcher enlisted one of its top executives, Sir Derek Rayner, to liven up the British civil service -- with very mixed results.
Leahy sees Tesco's main future expansion being abroad, most notably in Asia, where it already links with Chinese hypermarkets, and it has done serious research in Japan. However, the company will have learnt much from observing the unfortunate experience of Marks & Spencer in some of its overseas ventures.
Leahy's belief that "size is a mixed blessing" will ring bells with many shoppers. Most of us, while using supermarkets, loathe them, and bemoan the disappearance of corner shops: I certainly feel that shopping in small shops is much more pleasant.
Indeed, Tesco and Sainsbury have recognized this point, and have been opening their own version of the corner shop -- much smaller branches that are less forbidding to visit.
And my own family? Well, we've given up going to supermarkets altogether, and use a delivery service set up by an enterprising group of former merchant bankers. The other weekend, when the delivery man and I were reminiscing about how grocery delivery vans represent a return to the happy days of the 1950s, he said, "Yes, and my mother used to give the delivery man a cup of tea."
"Would you like one?" I asked, picking up the hint. "No thank you sir. The traffic wardens will get me if I do."
NO HUMAN ERROR: After the incident, the Coast Guard Administration said it would obtain uncrewed aerial vehicles and vessels to boost its detection capacity Authorities would improve border control to prevent unlawful entry into Taiwan’s waters and safeguard national security, the Mainland Affairs Council (MAC) said yesterday after a Chinese man reached the nation’s coast on an inflatable boat, saying he “defected to freedom.” The man was found on a rubber boat when he was about to set foot on Taiwan at the estuary of Houkeng River (後坑溪) near Taiping Borough (太平) in New Taipei City’s Linkou District (林口), authorities said. The Coast Guard Administration’s (CGA) northern branch said it received a report at 6:30am yesterday morning from the New Taipei City Fire Department about a
IN BEIJING’S FAVOR: A China Coast Guard spokesperson said that the Chinese maritime police would continue to carry out law enforcement activities in waters it claims The Philippines withdrew its coast guard vessel from a South China Sea shoal that has recently been at the center of tensions with Beijing. BRP Teresa Magbanua “was compelled to return to port” from Sabina Shoal (Xianbin Shoal, 仙濱暗沙) due to bad weather, depleted supplies and the need to evacuate personnel requiring medical care, the Philippine Coast Guard (PCG) spokesman Jay Tarriela said yesterday in a post on X. The Philippine vessel “will be in tiptop shape to resume her mission” after it has been resupplied and repaired, Philippine Executive Secretary Lucas Bersamin, who heads the nation’s maritime council, said
REGIONAL STABILITY: Taipei thanked the Biden administration for authorizing its 16th sale of military goods and services to uphold Taiwan’s defense and safety The US Department of State has approved the sale of US$228 million of military goods and services to Taiwan, the US Department of Defense said on Monday. The state department “made a determination approving a possible Foreign Military Sale” to the Taipei Economic and Cultural Representative Office in the US for “return, repair and reshipment of spare parts and related equipment,” the defense department’s Defense Security Cooperation Agency said in a news release. Taiwan had requested the purchase of items and services which include the “return, repair and reshipment of classified and unclassified spare parts for aircraft and related equipment; US Government
More than 500 people on Saturday marched in New York in support of Taiwan’s entry to the UN, significantly more people than previous years. The march, coinciding with the ongoing 79th session of the UN General Assembly, comes close on the heels of growing international discourse regarding the meaning of UN Resolution 2758. Resolution 2758, adopted by the UN General Assembly in 1971, recognizes the People’s Republic of China (PRC) as the “only lawful representative of China.” It resulted in the Republic of China (ROC) losing its seat at the UN to the PRC. Taiwan has since been excluded from