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Tesco opens discount store Jack's to take on Lidl and Aldi Tesco opens discount store Jack's to take on Lidl and Aldi
(35 minutes later)
Tesco is stepping up its fightback against Aldi and Lidl with the launch on Wednesday of its own cut-price chain, Jack’s. Tesco is stepping up its fightback against Aldi and Lidl with the launch of its own cut-price chain, Jack’s.
The first store will be unveiled later by the Tesco chief executive, Dave Lewis, in the small Cambridgeshire town of Chatteris. The new chain is named after Jack Cohen, who founded Tesco 99 years ago, earning the nickname “Slasher Jack” for his “pile-it-high, sell-it-cheap” approach to retailing. The first store has been unveiled by the Tesco chief executive, Dave Lewis, in the small Cambridgeshire town of Chatteris. The public will get their first chance to shop at Jack’s on Thursday morning when the store opens, along with a second outlet in Immingham, Lincolnshire.
Tesco is expected to open up to 60 Jack’s stores over the coming months as it takes on Aldi and Lidl, two German discounters that have shaken up the UK grocery trade, nearly doubling their market share to 13.1% in the last five years. Their growth continues to far outpace that of traditional supermarkets. The new chain is named after Jack Cohen, who founded Tesco 99 years ago, earning the nickname “Slasher Jack” for his “pile-it-high, sell-it-cheap” approach to retailing.
Tesco says it plans to open 10 to 15 Jack’s stores in 2019, about half of which will be converted Tesco outlets, as it takes on Aldi and Lidl, two German discounters that have shaken up the UK grocery trade, nearly doubling their market share to 13.1% in the last five years. Their growth continues to far outpace that of traditional supermarkets.
Tesco, Sainsbury’s, Asda and Morrisons have all been forced to slash costs and close unprofitable stores to fund price cuts on everyday essentials where competition from discounters is heaviest.Tesco, Sainsbury’s, Asda and Morrisons have all been forced to slash costs and close unprofitable stores to fund price cuts on everyday essentials where competition from discounters is heaviest.
Tesco has also launched an array of cut-price goods under in-house brands such as Creamfields, Butcher’s Choice and The Growers Harvest, but 1,800 of Jack’s 2,600 products are a new own-label bearing the new chain’s name.
As much as 80% of the products will be grown, reared or made in the UK and the store’s focus on British product and Tesco’s long heritage are all well flagged in store in an attempt to differentiate it from Aldi and Lidl.
Tesco: 27.4Tesco: 27.4
Sainsbury’s: 15.4Sainsbury’s: 15.4
Asda: 15.3Asda: 15.3
Morrisons: 10.2Morrisons: 10.2
Aldi: 7.6Aldi: 7.6
Co-op: 6.6Co-op: 6.6
Lidl: 5.5Lidl: 5.5
Waitrose: 5.1Waitrose: 5.1
Iceland: 2.1Iceland: 2.1
Ocado: 1.2Ocado: 1.2
Others: 3.5BodyMarket share (% in the 12 weeks to 9 September 2018) Others: 3.5Market share (% in the 12 weeks to 9 September 2018)
Tesco has also launched an array of cut-price goods under in-house brands such as Creamfields, Butcher’s Choice and The Growers Harvest, all of which are expected to be stocked in Jack’s alongside specialist products under the new chain’s name. Tesco has also marshalled its technology skills to give a new spin to discount retailing. Shoppers will be able to scan and pay for their shopping using a mobile app as an alternative to its traditional check outs and self service tills.
The new format opens in a Tesco “ghost store” that has lain empty since 2014 when the retailer halted expansion plans after a dive in profits and an accounting scandal.The new format opens in a Tesco “ghost store” that has lain empty since 2014 when the retailer halted expansion plans after a dive in profits and an accounting scandal.
Until Wednesday, Jack’s had been kept heavily under wraps, with staff and visitors asked to sign confidentiality agreements and the windows covered with plastic boards.Until Wednesday, Jack’s had been kept heavily under wraps, with staff and visitors asked to sign confidentiality agreements and the windows covered with plastic boards.
Most of the new Jack’s outlets will be converted from Metro stores in locations such as St Helens, on Merseyside, and Rubery in Worcestershire.Most of the new Jack’s outlets will be converted from Metro stores in locations such as St Helens, on Merseyside, and Rubery in Worcestershire.
Tesco will be hoping Jack’s has more staying power than the discount chains tested by its mainstream rivals. Sainsbury’s opened a string of Netto stores with the Danish chain’s parent group in 2014, only to shut them two years later after struggling to make a profit. Asda’s 2006 experiment with the Asda Essentials chain also swiftly closed.Tesco will be hoping Jack’s has more staying power than the discount chains tested by its mainstream rivals. Sainsbury’s opened a string of Netto stores with the Danish chain’s parent group in 2014, only to shut them two years later after struggling to make a profit. Asda’s 2006 experiment with the Asda Essentials chain also swiftly closed.
Increased competition has prompted Sainsbury’s and Asda, the UK’s second- and third-largest supermarket chains, to merge in an effort to cut costs, prompting an in-depth investigation by the competition watchdog.Increased competition has prompted Sainsbury’s and Asda, the UK’s second- and third-largest supermarket chains, to merge in an effort to cut costs, prompting an in-depth investigation by the competition watchdog.
The Competition and Markets Authority said on Wednesday it would examine whether shoppers could face higher prices or poorer quality of service in hundreds of areas where the stores overlap. It will also examine the potential impact on the fuel and clothing markets as well ason suppliers.The Competition and Markets Authority said on Wednesday it would examine whether shoppers could face higher prices or poorer quality of service in hundreds of areas where the stores overlap. It will also examine the potential impact on the fuel and clothing markets as well ason suppliers.
TescoTesco
AldiAldi
LidlLidl
SupermarketsSupermarkets
Retail industryRetail industry
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