Tesco ditches food sales in new stores trial

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Tesco will launch a fresh attack on the high street in October with its first stores dedicated to non-food since the Home 'n' Wear days of the Seventies.

Tesco will launch a fresh attack on the high street in October with its first stores dedicated to non-food since the Home 'n' Wear days of the Seventies.

Sir Terry Leahy, the chief executive, is keen to tap the four in five people who lack access to its Tesco Extra hypermarkets, which house its full non-food selection.

The first two trial sites will open in Aberdeen and Manchester under the Tesco Homeplus banner. The group is believed to have lined up a small pipeline of further sites, starting with Bristol and Telford.

Much of the group's recent success is down to its non-food operations, which are growing twice as fast as its food business. The higher margins from selling lines such as clothing and homewear help to compensate for the low margins on food.

Tim Mason, Tesco's marketing director, said: "We hope this trial will be popular with those customers who cannot access our great value and wide range of non-food products."

The group has borrowed the Homeplus tag from its South Korean business. It recently bought out its Korean partner Samsung. The new UK Homeplus sites will be about 30,000 sq ft and situated on out-of-town retail parks. They will look like one of its hypermarket Extra stores ­ but without the food.

Tesco's move piles the pressure on retailers from Boots to WH Smith. It also adds to Asda's recent misery. The Wal-Mart-owned master of non-food, which has seen underlying sales growth slow sharply, recently opened Asda Living stores to showcase its full range of non-food goods. The first will open in the South this year. It also has separate stores that sell its George clothing.

Tesco's first dalliance with non-food was spearheaded by the late Sir Leslie Porter, who was married to the daughter of Jack Cohen, the company's founder. Sir Leslie joined Tesco at his father-in-law's behest as head of the newly formed Home 'n' Wear department.

There were 62 separate Home 'n' Wear stores by the Seventies. The division was phased out under Lord MacLaurin in the Eighties.

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