Tesco stores to close.

[Kite159]

It will be interesting to see which stores are selected for closure, most likely town centre metro/express stores with high business rates or lease costs.

Although they have recently opened up an Express store outside Waterloo, next door to the Sainsburys Local.

Home Phone and Internet off to Talk Talk, how long until they sell off the Mobile Phone part of the business?

 

[ModernRailways]

It will be interesting to see which stores are selected for closure, most likely town centre metro/express stores with high business rates or lease costs.

Although they have recently opened up an Express store outside Waterloo, next door to the Sainsburys Local.

Home Phone and Internet off to Talk Talk, how long until they sell off the Mobile Phone part of the business?

From what I've heard it's 23 Express stores to close, with the rest being other stores (not 100% sure on anything yet though), and apparently they want to try and only close stores whereby lost customers may go to another Tesco nearby. So instead of their being 2 Tesco stores near to each other, 1 will close the other will stay open.

I do hope Tesco Mobile stays part of Tesco too, fingers crossed it stays!

 

[richw]

how long until they sell off the Mobile Phone part of the business?

I hope not. Their mobile contracts are the best I've had. Great service, and very cheap.

 

[Kite159]

I hope not as well, no other company can beat my £7.50 a month sim only deal (250 minutes, 5000 texts, 750MB of data) (although 3 comes close, but don't count as the 3 signal in this part of the country is non existent).

 

[ModernRailways]

My employer moved the vast majority of functions from the SE to SW. Apparently massive savings, and they pay highly for the SW for staff salaries at a level that was too low for the SE.

Only senior management are left in a smaller office space in the SE now for convenience of being near to where they need to be for their roles.

Office space in Cornwall is also much cheaper.

I guess it depends on the business function too though. Tesco has a lot of staff in Welwyn who actually go out into the stores and help out - over Christmas I had the joy of working with our Business and Marketing Manager and she was saying about how a lot of staff come out into stores at Christmas to give a hand and get a shock by how hard staff on the shop floors actually work to make the eco system go round.

Welwyn is also quite a central location, with good links to the whole country for the most part (just a trip into London if travelling by train), and whilst it isn't in London it's not too far away and can be reached within 45 minutes. To me it seems like a good location, to others it may not. Like I say though it will all be down to the individual business needs.

 

[richw]

I hope not as well, no other company can beat my £7.50 a month sim only deal (250 minutes, 5000 texts, 750MB of data) (although 3 comes close, but don't count as the 3 signal in this part of the country is non existent).

Mine is £12.50 with 24 month contract.
I like they break down the amount you pay for the airtime/line rental and the amount for the phone handset.
My airtime is £7.50 for the same as you, and my phone handset is £5 a month, all taken as one monthly bill

 

[dgl]

Our local Tesco seems to be doing well and I would highly doubt (and hope it won't) it would close, but then they have a quite a captive audience with the only close competition being 3 small co-op's (I'm on a small, sort of island and Tesco's was big news and defiantly welcomed by most).

Most other supermarkets close by (we have Tesco's (our small superstore, 2 expresses and a metro), ASDA, Morrison's, Sainsbury's, Lidl, Iceland and Aldi within 7 miles) also seem to be doing alright but the rare time I go to Sainsbury's it seems to be quiet.

What all supermarkets need to realise is that there is more real competition and it is going to mean that they will see their market share reduced, they just need to work out how they can still remain profitable with these lower market shares.

 

[ushawk]

I work for them and was informed today my job is "at risk". Us staff simply know as much as Joe Public - no more details will be known until March at the earliest.

43 stores will close, mainly express stores but also possibly a couple of larger Metro stores. These will all be stores operating at a loss, so it of course makes no sense to keep them open. Staff will where possible be moved to other locations, if not possible then it will be redundancy. Managers at HQ are being made redundant too to streamline the company.

The new boss, Dave Lewis, came in with the job to completely turn the company around - after today he certainly is doing that. Getting rid of Blinkbox and Broadband is a good move, Tesco have too many fingers in too many pies, getting rid of the pies simplifies things.

As for the "deserve everything they get" comment, I assume you would rather have thousands unemployed then ? Sure, there are a lot of stores, but if there was no demand - they wouldnt have opened the amount. There is always the possibility of opening more stores in the future too, but the house needs to get in order first.

RE HQ location, Welwyn makes more sense. Decent location and close to where the majority of the business is - in the South East. The largest distribution centre is at Daventry after all as well - logistically the best place in the UK, with the rail link of course.

 

[Bletchleyite]

Mine is £12.50 with 24 month contract.
I like they break down the amount you pay for the airtime/line rental and the amount for the phone handset.

O2 do that as well. I think more networks will go that way as the EU are pushing for that much more transparent approach.

Neil

 

[Starmill]

I find them less pleasant than Aldi - I think it may be because their ranges are generally taken straight from Germany, while Aldi has Anglicised theirs a bit. They also (unlike Aldi now) don't take credit cards still, though I imagine that is only a matter of time as they will otherwise lose business to Aldi.

Neil

I'd be surprised if anyone, especially not anyone willing to go the trouble of going to ALDI or Lidl in the first place, is that bothered about paying with a credit card.

In fact it's perplexing that ALDI now take credit cards - if it keeps their prices lower I'd rather they didn't.

 

[Crossover]

Tesco opened Local stores in a couple of ex pubs near us - our nearest is rarely busy but people reckon it will stay

Been in local news (Look North) tonight about it - Tesco have nose pulled out of a couple of shopping complexes where they were to be the lead store - this leaves a possibly question mark as to whether some of these developments will still go ahead...

 

[DynamicSpirit]

Tesco are not the only ones doing it, Morrisons have recently closed a load of their local stores, and I wouldn't be surprised to see Sainsbury's follow suit.

It is very sad news, I feel very sorry for those whose jobs are now on the line.

I also have to say I find this unsurprising in one way. For years, the big supermarkets have been rushing to open new large stores wherever they can. Within a few of miles of my own area, we've seen a Tesco superstore open, followed by an out-of-town style ASDA, and no less than two out-of-town style Sainsburys are currently being built. With every store, there's talk of how many jobs are being created, but this ignores that the amount of food people buy is largely fixed. Noone's going to suddenly start eating twice as much as they used to just because there's a new superstore 2 miles up the road. New stores are inevitably going to make existing shops less viable. Because of this, I've suspected for a long time that the rush amongst supermarket chains to keep opening new stores is unsustainable, and something like this would eventually happen.

 

[Blindtraveler]

First and most important, to anyone affected by this I hope its all ok. I abandened tesco for anything other than milk, sarnies, lottery etc usually when out bashing quite a while back as felt and still feel they have lost there way. This announcement to me seams a case of shutting the stable door and a deal more will need doing. I awate with interest.

 

[Abpj17]

cheshunt is a bit of an odd decision; it's closer to the M25 and the building is practically next to the station. I'd guess it was looking more at Welwyn and Cheshunt and picking one of the two, rather than a serious consideration of moving elsewhere in the country.

 

[muddythefish]

I don't think moving our HQ from the South East would be beneficial. If you want the top people then you need to be with other big businesses.

The 'Tescoisation' also hasn't exactly been destroying towns, it may be the final nail in the coffin for some smaller stores that were literally just scraping by but as can be seen people aren't afraid to shop around for the best price/quality.

Why does Tesco "need to be with other big businesses" to attract "top people" ? Are there not "top people" in other parts of the country ?

If this country is to achieve the rebalancing to address the so-called north-south divide it needs companies like Tesco to move.

It's well documented that the arrival of Tesco and the like in towns has led to the closure of small family businesses and the general rundown of the high street. I don't know how you can argue otherwise.

 

[jon0844]

The worst that happens to those at the top is that they walk away with a nice fat pay off, often straight into a similar job elsewhere.

Talk about 'we're all in this together'.

I was on a train to Cheshunt today (my parents office is on Delamare Road, which is where the world HQ is that's going to be closing after goodness knows how many years) and listened in on a guy that worked for Tesco on the phone. I should have recorded the call as he was saying about a number of managers that were leaving, and - yes - for similar jobs elsewhere. He mentioned names and where they were going!

I did, however, get the impression that they were jumping ship and not necessarily getting nice pay offs. Perhaps we're going to hear more about issues in the coming months and years?

The 'ordinary' staff won't have to go TOO far to continue working if they want, but I was only saying to my parents on Monday that I wondered how long they could afford to keep running Golden Boy coaches to ferry staff from Cheshunt to Welwyn Garden City and back.

Now they won't have to for too much longer.

It's sad though. My mum worked for many years at their HQ, before she had an accident there and ultimately sued for an undisclosed amount (I won't go into detail, but this was before personal injury lawyers and my parents had to put their house on the line to get justice) but even she will be sad to see Tesco leave.

 

[muddythefish]

Welwyn is also quite a central location, with good links to the whole country for the most part (just a trip into London if travelling by train),
.

If you think Welwyn is in a central location and then you haven't travelled very far.

 

[jon0844]

It has also been announced that Matt Davis, currently CEO of Halfords will be taking over at Tesco in June.

It is quite a jump from Halfords to Tesco. That should be good for Tesco though, Matt is really good, in the space of two years he has completely turned around Halfords, and did the same with Pets at Home before that.

Ironically, the Halfords in Welwyn Garden City is still stuck in some sort of time warp and looks like it's still 1970!

RE HQ location, Welwyn makes more sense. Decent location and close to where the majority of the business is - in the South East. The largest distribution centre is at Daventry after all as well - logistically the best place in the UK, with the rail link of course.

Possibly more accessible than Cheshunt, but not much (Cheshunt, like WGC, enjoys some very fast trains to London). Of course, it's on the ECML but I don't know if that makes much difference to anything.

Tesco also has large distribution centres at Hatfield and Waltham Cross, and Cheshunt is still in the south east.

However, as you obviously know (but others may not). WGC is the UK HQ and Cheshunt the main HQ for all operations. Hatfield recently saw F&F arrive.

It makes sense to keep everyone close together and get rid of shuttle buses that have been chartered for goodness knows how long.

I do hope there aren't lots of job losses, but wonder if Tesco will perhaps cut its own developments but continue to work on other developments, like building housing and other properties, and making money as landlord via its Spenhill division.

And if Tesco owns any of the land along Delamare Road, perhaps it's going to get a fair bit of money renting out the offices to someone else, or seeking planning to build flats.

 

[IanXC]

Why does Tesco "need to be with other big businesses" to attract "top people" ? Are there not "top people" in other parts of the country ?

If this country is to achieve the rebalancing to address the so-called north-south divide it needs companies like Tesco to move.

Indeed - in any case surely the largest concentration of supermarket HQs is in West Yorkshire...!

 

[RichmondCommu]

This is the bit that really annoys me. The management and board overstretch themselves, and the staff have to take the hit.

Its the Final Salary scheme that is closing.
--- old post above --- --- new post below ---

If you think Welwyn is in a central location and then you haven't travelled very far.

Its central to whats important

 

[Greenback]

The new boss, Dave Lewis, came in with the job to completely turn the company around - after today he certainly is doing that. Getting rid of Blinkbox and Broadband is a good move, Tesco have too many fingers in too many pies, getting rid of the pies simplifies things.

The fingers in pies thing is exactly what led to the feeling that Tesco had got too big for its boots.

As for the "deserve everything they get" comment, I assume you would rather have thousands unemployed then ? Sure, there are a lot of stores, but if there was no demand - they wouldnt have opened the amount. There is always the possibility of opening more stores in the future too, but the house needs to get in order first.

It's never nice to see people lose their jobs, it;s happened to me on a few occasions. I feel genuinely sorry who will be worried about losing their jobs, and, of course, for those who do lose them.

But it's difficult to argue that Tesco, and to a lesser extent the other big supermarkets that are now starting to struggle, aren't at least partly responsible by their aggressive expansionist policies and their apparent desire to put everybody else out of business along the way.

I can understand why there is an element of gloating to see a company that many felt considered themselves mighty and untouchable, are not having it all their own way for once.

I was on a train to Cheshunt today (my parents office is on Delamare Road, which is where the world HQ is that's going to be closing after goodness knows how many years) and listened in on a guy that worked for Tesco on the phone. I should have recorded the call as he was saying about a number of managers that were leaving, and - yes - for similar jobs elsewhere. He mentioned names and where they were going!

I did, however, get the impression that they were jumping ship and not necessarily getting nice pay offs. Perhaps we're going to hear more about issues in the coming months and years?

I was talking about the most senior echelons, who make decisions and set the policies, but the additional clarification is useful. Backroom admin staff, along with junior and middle management tend to be treated as badly as the front line store staff in these situations.

 

[jon0844]

All companies that get huge eventually seem to go this way.

In the world of tech, Nokia was a good example, Motorola another. Both huge companies that got complacent and arrogant. It almost certainly will happen to Apple.

And history shows plenty of other examples. It's never even a case of getting big, then struggling to maintain the number one spot (you can only expand or increase profits for so long) but rather a big drop.

We all remember Ryanair being arrogant enough to think customers would take whatever they were hit with (poor service, new charges/fees, more 'gotchas') because they were cheap. It worked for some considerable time and then people said 'enough' and flew with someone else.

Now Ryanair is reinventing itself, and so will Tesco. And I don't know if setting up in-store bakeries and coffee shops that are sold as family run businesses, as if a local store on the high-street that has nothing to do with Tesco, will work. People saw through it and felt like they were being conned.

Tesco needs to treat everyone better. Its own staff. Its suppliers and its customers. It perhaps also needs to find out what its customers want and expect, as it can't try and be a jack of all trades as it is now. That's the same problem M&S has and has had for years.. not knowing its market and trying to satisfy everyone. Frankly, you can't expect to appeal to kids and teenagers when you're selling clothes for old people on the other side of an aisle.

 

[Greenback]

Tesco has several areas which need to be addressed. The 'jack of all trades' situation seems to be flying in the face of current consumer trends, which is seeing a bit of a return to smaller retailers, as well as online shopping, of course.

But the biggest problem, at least in this area where I've discussed it frequently with friends and family, is that Tesco is perceived as being of low quality, many [people I know now believe that Lidl and Aldi have superior products, and at a lower cost.

In my view Tesco are being squeezed from all directions. On quality they are being beaten by just about everyone else, on price they are being undercut by many other retailers now, and they are facing the same problems as other high street retailers who are being hit by the convenience of online shopping, whether it's by click and collect or home delivery.

It remains to be seen whether the recently announced measures will be enough to satisfy the city, and that's the place that really matters.

 

[Bletchleyite]

Its the Final Salary scheme that is closing.

One of the few left, then. I don't think they can be massively criticised for that, as the same criticism would apply to pretty much every other commercial company that has already done so.

Neil
--- old post above --- --- new post below ---

Ironically, the Halfords in Welwyn Garden City is still stuck in some sort of time warp and looks like it's still 1970!

Still in the blue colours with the national speed limit logo?

Neil
--- old post above --- --- new post below ---

Not pleased. I'm in the process if transferring to Tesco home phone and broadband. My parents are with them already and they have actually been quite good. Tesco Broadband get a good review in Which? magazine, whereas TalkTalk always get terrible reviews so were on my bargepole list. I'm not looking forward to the takeover and if TalkTalk change anything in my contract (free calls to other Tesco phone subscribers, Clubcard points, etc.) then I'll be leaving ASAP.

I have never heard a good word said about Talktalk by anyone (other than the price, but you get what you pay for) and I would not touch them with a barge pole personally.

Neil
--- old post above --- --- new post below ---

They do take credit cards now. No Amex though.

Lidl do? Good. Might pay them a visit.

Neil

 

[Greenback]

A bit off topic, really, but every time I change the supplier of something I end up back with them. I moved from Lloyds Bank to Halifax only to find they had to merge, and this has happened quite a few times one way or another.

As a former Tiscali customer, I moved when they were swallowed up by TalkTalk, and eventually found myself with Tesco, and it looks as if I'll end up back at TalkTalk again shortly. Oh well, such is life!

 

[Bletchleyite]

I'd be surprised if anyone, especially not anyone willing to go the trouble of going to ALDI or Lidl in the first place, is that bothered about paying with a credit card.

You'd be surprised. Personally, the way I work my monthly budgets I never pay for anything by debit card, though my credit card is always settled at month end. I also prefer the security of a credit card - if it is cloned, I just lose that card (I have two, mainly so I can split out business expenses if I need to) rather than having a chunk of money gone out of my current account.

It doesn't put me off buying odd items from Aldi/Lidl but it certainly would put me off a big weekly shop there as it would mess with how I run my finances.

This is an approach I inherited from my parents, so I'm not the only one who does it.

In fact it's perplexing that ALDI now take credit cards - if it keeps their prices lower I'd rather they didn't.

I'd suggest that, like I did for Nederlandse Spoorwegen, if there is a significant increased cost it is not unreasonable to pass it on (at cost plus standard overall profit margin, not Ryanair-style) to the customer. But I would prefer they accepted it, or they don't get my (substantial) custom.

Neil
--- old post above --- --- new post below ---

It's well documented that the arrival of Tesco and the like in towns has led to the closure of small family businesses and the general rundown of the high street. I don't know how you can argue otherwise.

It's also clear that the reason this is the case is because people like shopping in supermarkets rather than small businesses. Were it not the case, the small businesses[1] would retain the business and Tesco would fail. You can't blame Tesco for this, it is the consumer's decision where their money goes.

[1] Tesco opened up an Express store right next to a Co-op local to me. Many thought the Co-op would close, but it hasn't - it's apparently doing better than ever. With this announcement, it wouldn't overly surprise me if it was actually the Tesco that goes, particularly given that Morrisons are going to open an M Local in an old pub about 5-10 minutes' walk away. (OK, Co-op isn't a small business in that sense, but it's certainly one most would see as a more ethical alternative to Tesco).

Neil

 

[Tetchytyke]

In fact it's perplexing that ALDI now take credit cards - if it keeps their prices lower I'd rather they didn't.

The people most likely to be in Aldi and Lidl- the ones who are struggling to make ends meet- and the ones most likely to be paying by credit card at the end of the month.

I don't think moving our HQ from the South East would be beneficial. If you want the top people then you need to be with other big businesses.

Hmm. Both Asda and Aldi- who are teaching Tesco a lesson or ten about supermarket retailing at the moment- are not headquartered in the south east. Asda's HQ is in Leeds and Aldi's is in Atherstone in Warwickshire.

Now Ryanair is reinventing itself, and so will Tesco. And I don't know if setting up in-store bakeries and coffee shops that are sold as family run businesses, as if a local store on the high-street that has nothing to do with Tesco, will work. People saw through it and felt like they were being conned.

I think that depends on how they play it.

A small number of vocal yummy mummies in Crouch End got very angry when they realised Harris and Hoole was owned by Tesco, but that anger hasn't really been repeated elsewhere, even with other H&H branches in places like Amersham or Rickmansworth. And for all the whining the Crouch End H&H is usually rammed. The Euphorium Bakery, for instance, doesn't get any anger at all, and they're still trying to pretend they're a family baker that grew out of a tiny shop on Upper Street. You don't see the anger directed at Giraffe either.

Tesco's main trouble is that they are trying to be everything to everyone, and it doesn't really work- the higher end products make them look expensive, yet the lower end products make them look poor quality. It's very tough to appeal to the sorts of people who routinely shop at Waitrose or Booths if half your store is full of "bargain brands", and it's hard to appeal to those who have defected to Aldi or Asda if half your store is full of premium products at premium prices. Sainsbury's have mostly aimed towards the top end of the market and are doing better as a result (although I personally hate the place, they have Waitrose prices without the quality or customer service to match).

They really need to work out whether they're trying to compete with Waitrose and Booths- and make their shops nicer if they are- or if they're trying to compete with Asda. My local Tesco has a Harris and Hoole and a Euphorium Bakery, both marketed as premium brands (which, in fairness, they are), yet inside the store they're trying to portray themselves as a discounter. It simply doesn't work. They can't be both.

I think they also made a major boo-boo with Clubcard, which was really their one unique selling point (given that Nectar's about as much use as a chocolate teapot). Allowing the double points "promotion" to last so long made it look like a cut when it was removed, doubly so as they justified it as "funding price cuts in store". Clubcard attracts people in to the shop but the cut in points devalued the scheme and pushed people away. Bringing double points back, at a time when Sainsbury are cutting back on Nectar, might be a quick win for them.

 

[Bishopstone]

Retail is going to continue to take a pounding because wages have stagnated for so long now that nobody has any disposable income left.

So who are all these people in Costa Coffee and Starbucks buying £2.50 cuppas?

And why are new car registrations near an all time high?

Some people have seen stagnant wages, but very large numbers are doing fine, thanks to low mortgage rates, deflation in the prices of certain products, and lump sum settlements from PPI compensation etc.

The death of the retail sector is much exaggerated, but whilst the consensus is doom, I will be topping-up my retail shareholdings: selectively, of course.

 

[Tetchytyke]

So who are all these people in Costa Coffee and Starbucks buying £2.50 cuppas?

Starbucks hasn't made a profit in the UK since they arrived.

And why are new car registrations near an all time high?

That probably has more to do with the way car finance is structured than anything to do with disposable income. Most car finance agreements are now little more than rental agreements- a small monthly payment but with an enormous balloon payment after 24 or 36 months. Rather than pay the balloon payment you can hand the keys back and get a new car on a new agreement, which most people prefer to do.

Some people have seen stagnant wages, but very large numbers are doing fine, thanks to low mortgage rates, deflation in the prices of certain products, and lump sum settlements from PPI compensation etc.

I think people are able to maintain an appearance of "doing fine" through the use of credit, given that credit is just as available and affordable as now as it was just before the "credit crunch". So long as interest rates stay low and credit availability stays high people will be fine, but if either of those two things change then things will tank very very quickly.

 

[Bletchleyite]

Starbucks hasn't made a profit in the UK since they arrived.

I thought that was allegedly deliberate.

Neil