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| Tesco eyeing a slice of the lucrative takeaway trade in London | |
| (about 14 hours later) | |
| Tesco is understood to be working on a high-street takeway-food chain that would compete with Pret à Manger, Eat and Greggs. Analysts said the supermarket is putting the finishing touches to a new format called "Tesco Express food to go" that would be focused on the large London market. | Tesco is understood to be working on a high-street takeway-food chain that would compete with Pret à Manger, Eat and Greggs. Analysts said the supermarket is putting the finishing touches to a new format called "Tesco Express food to go" that would be focused on the large London market. |
| Steve Dresser of Grocery Insight said the supermarket was targeting as many as 80 outlets in the capital as it looked to tap into the lucrative lunchtime sandwich and snack market. | Steve Dresser of Grocery Insight said the supermarket was targeting as many as 80 outlets in the capital as it looked to tap into the lucrative lunchtime sandwich and snack market. |
| As part of Philip Clarke's turnaround plan, Tesco has been revamping its supermarkets and introducing "food to go" areas selling takeaway fare such as salads, artisan sandwiches and roast chicken. | As part of Philip Clarke's turnaround plan, Tesco has been revamping its supermarkets and introducing "food to go" areas selling takeaway fare such as salads, artisan sandwiches and roast chicken. |
| Tesco is also experimenting with the food and drink brands that it either owns or has invested in. Harris+Hoole is opening coffee shops in Tesco's larger stores, while Giraffe, the restaurant chain it bought in 2013, has started to open kiosks in high-footfall areas such as railway stations. A New York-style diner called Fred's Food Construction recently opened at the Tesco Extra in Osterley, west London. Tesco, which will report its annual results next week, declined to comment. | Tesco is also experimenting with the food and drink brands that it either owns or has invested in. Harris+Hoole is opening coffee shops in Tesco's larger stores, while Giraffe, the restaurant chain it bought in 2013, has started to open kiosks in high-footfall areas such as railway stations. A New York-style diner called Fred's Food Construction recently opened at the Tesco Extra in Osterley, west London. Tesco, which will report its annual results next week, declined to comment. |
| The City expects Britain's biggest supermarket to announce a 10% decline in trading profit to £3.2bn, while analysts at Shore Capital have forecast another decline next year, to less than £3bn, for the first time since 2009. | The City expects Britain's biggest supermarket to announce a 10% decline in trading profit to £3.2bn, while analysts at Shore Capital have forecast another decline next year, to less than £3bn, for the first time since 2009. |
| Analysts said the mooted takeaway stores would be smaller than 3,000sq ft – less than a third the size of a typical Tesco Metro – and located close to existing Metro or Express stores, which could supply the smaller branches. Sainsbury's pulled the plug on a similar concept called Fresh Kitchen in 2012 after it struggled to find the right formula for a high footfall store in central London. | Analysts said the mooted takeaway stores would be smaller than 3,000sq ft – less than a third the size of a typical Tesco Metro – and located close to existing Metro or Express stores, which could supply the smaller branches. Sainsbury's pulled the plug on a similar concept called Fresh Kitchen in 2012 after it struggled to find the right formula for a high footfall store in central London. |
| Dresser suggested the new Tesco stores would be an "effective hook" for customers, but warned that staffing costs were high and that there was potential for wastage. "It won't solve Tesco's problems, but it brings them full circle with the focus back on food," he said. "It will help with the battle for hearts and minds and help to drive customers to larger stores. It's also another way to drive Clubcard scans. Food to go is high footfall and naturally opens up opportunities for click and collect." | Dresser suggested the new Tesco stores would be an "effective hook" for customers, but warned that staffing costs were high and that there was potential for wastage. "It won't solve Tesco's problems, but it brings them full circle with the focus back on food," he said. "It will help with the battle for hearts and minds and help to drive customers to larger stores. It's also another way to drive Clubcard scans. Food to go is high footfall and naturally opens up opportunities for click and collect." |
| Clarke is under pressure to take action as Tesco loses market share to discounters such as Aldi and Lidl as well as more upmarket stores such as Waitrose and Marks & Spencer. This week it was revealed that Tesco's sales fell 3% in the 12 weeks to 30 March. | Clarke is under pressure to take action as Tesco loses market share to discounters such as Aldi and Lidl as well as more upmarket stores such as Waitrose and Marks & Spencer. This week it was revealed that Tesco's sales fell 3% in the 12 weeks to 30 March. |