James Moore: Tesco needs to turn up the heat as marketplace gets a whole lot chillier

Outlook Just as it looked as if Tesco was turning the corner it's back into reverse gear again. Sales are declining and the brushfires that were burning across the empire seem to have flared up again.

The grocer's big hypermarkets are out of fashion and offering too much of the sort of product that consumers can more easily and cheaply purchase online from competitors such as Amazon that pay minimal business rates (no shops) and minimal corporation tax (supine politicians and tax authorities).

Tesco's food sales have been hit by the horse-meat crisis in the UK, it is faced with economic difficulties in central Europe and regulators have clipped its wings by restricting opening hours in South Korea.

It's struggling with these potholes while its competitors motor on (except poor Morrison's, which is awaiting the RAC).

Shareholders may have to accept that this sort of patchy performance is becoming the new norm for a business whose fortunes are hugely dependent upon the struggling consumer.

It can make things better than they are: too many stores are still unfriendly places to shop and if you're going to go to a supermarket, as opposed to an out and out discounter like Aldi, you're going to go somewhere you feel loved. If you're disabled, have children, if you simply want a little help, life tastes better at Sainsbury's in too many places where the two compete head to head. The numbers tell their own story.

This is a problem that can be solved as more stores are subjected to chief executive Philip Clarke's makeover programme. It's also dangerous to read too much into a single set of quarterly numbers. It's easy to forget how well Tesco did over Christmas.

And this is no crisis, more a reflection on how surprising it is to see this once unstoppable juggernaut stuttering. It's not even as if the company hasn't made visible progress in some areas. It's still way ahead of the curve online, even if making money from the non-food part of that channel is still tough.

But fundamentally, Mr Clarke is never likely to enjoy the sort of gushing acclaim that his predecessor Sir Terry Leahy – who stepped down at exactly the right time – took for granted. Tesco is a much bigger, more mature, and slower-growing business now, and the world it operates in is a different place. A chillier one. Mr Clarke could be judged a success if he can just locate a fuel source for a heater.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Pricing Analyst

£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...

Guru Careers: C# Project Team Lead

£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...

Day In a Page

Fifa corruption: The 161-page dossier that exposes the organisation's dark heart

The 161-page dossier that exposes Fifa's dark heart

How did a group of corrupt officials turn football’s governing body into what was, in essence, a criminal enterprise? Chris Green and David Connett reveal all
Mediterranean migrant crisis: 'If Europe thinks bombing boats will stop smuggling, it will not. We will defend ourselves,' says Tripoli PM

Exclusive interview with Tripoli PM Khalifa al-Ghweil

'If Europe thinks bombing boats will stop smuggling, it will not. We will defend ourselves'
Raymond Chandler's Los Angeles: How the author foretold the Californian water crisis

Raymond Chandler's Los Angeles

How the author foretold the Californian water crisis
Chinese artist who posted funny image of President Xi Jinping facing five years in prison as authorities crackdown on dissent in the arts

Art attack

Chinese artist who posted funny image of President Xi Jinping facing five years in prison
Marc Jacobs is putting Cher in the limelight as the face of his latest campaign

Cher is the new face of Marc Jacobs

Alexander Fury explains why designers are turning to august stars to front their lines
Parents of six-year-old who beat leukaemia plan to climb Ben Nevis for cancer charity

'I'm climbing Ben Nevis for my daughter'

Karen Attwood's young daughter Yasmin beat cancer. Now her family is about to take on a new challenge - scaling Ben Nevis to help other children
10 best wedding gift ideas

It's that time of year again... 10 best wedding gift ideas

Forget that fancy toaster, we've gone off-list to find memorable gifts that will last a lifetime
Paul Scholes column: With the Premier League over for another year, here are my end of season awards

Paul Scholes column

With the Premier League over for another year, here are my end of season awards
Heysel disaster 30th anniversary: Liverpool have seen too much tragedy to forget fateful day in Belgium

Liverpool have seen too much tragedy to forget Heysel

Thirty years ago, 39 fans waiting to watch a European Cup final died as a result of a fatal cocktail of circumstances. Ian Herbert looks at how a club dealt with this tragedy
Amir Khan vs Chris Algieri: Khan’s audition for Floyd Mayweather may turn into a no-win situation, says Frank Warren

Khan’s audition for Mayweather may turn into a no-win situation

The Bolton fighter could be damned if he dazzles and damned if he doesn’t against Algieri, the man last seen being decked six times by Pacquiao, says Frank Warren
Blundering Tony Blair quits as Middle East peace envoy – only Israel will miss him

Blundering Blair quits as Middle East peace envoy – only Israel will miss him

For Arabs – and for Britons who lost their loved ones in his shambolic war in Iraq – his appointment was an insult, says Robert Fisk
Fifa corruption arrests: All hail the Feds for riding to football's rescue

Fifa corruption arrests

All hail the Feds for riding to football's rescue, says Ian Herbert
Isis in Syria: The Kurdish enclave still resisting the tyranny of President Assad and militant fighters

The Kurdish enclave still resisting the tyranny of Assad and Isis

In Syrian Kurdish cantons along the Turkish border, the progressive aims of the 2011 uprising are being enacted despite the war. Patrick Cockburn returns to Amuda
How I survived Cambodia's Killing Fields: Acclaimed surgeon SreyRam Kuy celebrates her mother's determination to escape the US

How I survived Cambodia's Killing Fields

Acclaimed surgeon SreyRam Kuy celebrates her mother's determination to escape to the US
Stephen Mangan interview: From posh buffoon to pregnant dad, the actor has quite a range

How Stephen Mangan got his range

Posh buffoon, hapless writer, pregnant dad - Mangan is certainly a versatile actor