As headlines here were dominated by retailer collapses such as Habitat and Homeform, Tesco was reminding the City of its international counterweight to the troubled UK market.
While dark clouds loom in places like Peterborough or Croydon, the retail skies looked sunnier in Prague and Krakow. The UK may be the motor of Tesco’s profits, but analysts on the grocer’s tour of central Europe seemed impressed by its achievements and prospects there.
Although it’s been there for a while, Tesco still has the opportunity in Mitteleuropa to be the first to do some of the things that made it such a powerful force at home.
The message was that there are opportunities in everything from hypermarkets to smaller stores to sourcing and ecommerce. And, as in the past, there are potential benefits to the core UK business from what is learned and done in central Europe.
During the trip, part of the focus was on new group boss Philip Clarke’s updates on his first 100 days in office. He’s only at the beginning of his reign, but he seems to have built on the respect he already had.
Tesco might be under pressure in the UK but, despite that, there’s one thing the City can be sure of: it sure as hell ain’t going bust.
Happy customers but at what cost?
Top retailers have resisted the temptation to go on Sale early, but the extent of promotions on the high street has left them little choice.
Marks & Spencer’s seasonal promotion, launched on Tuesday, was about a fortnight earlier than last year.
The sea of Sale signs on high street and shopping mall windows means that the game of chicken between retailer and consumer is keener than ever. Retailers are being forced to capitulate to shoppers’ expectation that bargains must be offered - otherwise consumers will keep their purses firmly closed. The question is, what is the cost to margin of keeping the customer satisfied?
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