UK-based Shore Capital Stockbrokers has said that there are ‘green shoots of encouragement’ for Tesco’s business in Ireland, despite the retailer losing its market leading position to SuperValu.
In a statement, Shore Capital said that: “In Ireland, which is expected to remain an important and valuable market for the group in the medium-term, there may also be suitably green shoots of encouragement as filtered through the Kantar data.
“We make this assertion within the context of share falling 120 basis points (bps) year-on-year in this market but where shopper numbers are said to have been stable over the last 12-months and basket size is increasing.”
While Shore Capital noted that Tesco’s market share “is not likely to expand anytime soon to our minds in Ireland or anywhere else for that matter with the moratorium on supermarket development that has been deployed by the group,” it added that the appointment of a new CEO and a store improvement programme could serve the retailer well.
“Just as Tesco is seeking to re-establish some stability as a platform for improvement in the UK, the same can also be said for Ireland.
“In this respect Dave Lewis, CEO, made an early decision to extract Ireland from the group’s European division and bring it under the auspices of soon to join Tesco UK & Ireland CEO, Matt Davies. In the interim, Andrew Yaxley has been transferred from a now defunct position as head of Tesco London, to become CEO of the business in Ireland.
“The trading strategy in Ireland has also evolved, mirroring the position taken in the UK, centring upon an improvement in basic store standards, which have been poor from our last major set of visits in H1 2014, enhancing customer service and improving the value quotient of the offer.”
© 2015 - Checkout Magazine by Stephen Wynne-Jones