Tesco&#x27;s and other big supermarkets to close stores

Original post by Rock Fan

Few years ago this would have been unheard of and crazy but now reality is Tesco's and some of the other big supermarkets will either shelve opening new stores and even close some of their stores. Obviously feel sorry for the staff who will now be without jobs but where has it gone wrong? it seems many people no longer spend their money in the big supermarkets.

http://www.bbc.co.uk/news/business-31023136

Much like the political parties I feel they've lost their niche and tried to become all things to all men. This has allowed gaps at the fringes where others have stepped in.

Reply 3

Everglow

The economy is becoming ever more difficult to succeed in, especially with supermarkets like Lidl and Aldi becoming relatively big players in the last year or two. While more competition is being created, which is meant to be good for the economy and the customer, this unfortunately results in the biggest players of all like Sainsbury's and Tesco's having to axe employees and stores to compensate. Competition in the market is surely what's been driving down the profits of supermarkets like Tesco's and Sainsbury's.

Reply 4

username47781

OP

Original post by Reluire

The economy is becoming ever more difficult to succeed in, especially with supermarkets like Lidl and Aldi becoming relatively big players in the last year or two. While more competition is being created, which is meant to be good for the economy and the customer, this unfortunately results in the biggest players of all like Sainsbury's and Tesco's having to axe employees and stores to compensate. Competition in the market is surely what's been driving down the profits of supermarkets like Tesco's and Sainsbury's.

Gonna suggest is it down to the likes of Lidl and Aldi lately enjoying a boom at the minute.

Reply 5

thunder_chunky

Good. I have some sympathy for those who are losing their jobs, but I don't have sympathy for the company as a whole who have driven local high street shops to breaking point.

Reply 6

Original post by thunder_chunky

Good. I have some sympathy for those who are losing their jobs, but I don't have sympathy for the company as a whole who have driven local high street shops to breaking point.

Yes, but as they close some of their overlapping mega stores/ sheds they will open more of their smaller local stores which will drive even more independents out of business.

Aldi/Lidl is only part of the equation, shopping habits are changing with far more people buying food in smaller amounts but more frequently. There are I suspect myriad reasons for this e.g. possibly younger shoppers use cars less and shop to/from work on a more regular basis. Customers appear to be splitting their shopping, certain items from one store and certain from another.

Reply 7

thunder_chunky

Original post by DJKL

Yes, but as they close some of their overlapping mega stores/ sheds they will open more of their smaller local stores which will drive even more independents out of business.

Aldi/Lidl is only part of the equation, shopping habits are changing with far more people buying food in smaller amounts but more frequently. There are I suspect myriad reasons for this e.g. possibly younger shoppers use cars less and shop to/from work on a more regular basis. Customers appear to be splitting their shopping, certain items from one store and certain from another.

I know habits have changed, but I still dislike how everything has be to be in a giant megastore these days. And I dislike how it has caused so many businesses to go broke, or come close to it. So when I see a company who tries to sell almost everything to make more money, and yet they still have to close some stores, I say good. They can **** themselves.

Reply 8

Original post by thunder_chunky

I know habits have changed, but I still dislike how everything has be to be in a giant megastore these days. And I dislike how it has caused so many businesses to go broke, or come close to it. So when I see a company who tries to sell almost everything to make more money, and yet they still have to close some stores, I say good. They can **** themselves.

You must really hate Amazon.

(edited 9 years ago)

Reply 9

fallen_acorns

does not surprise me.. the expansion had to end at one point..

I Grew up in a growing town, that has grown in population since I was a kid..

Back then we had one super market for the town, and a few small shops..

Now we have a waitrose, a lidl, a sainsburies, a coop, a tesco and an aldi will come soon.

Now dont get me wrong, the population has grown, but not enough to accomodate such a huge increase in supermarkets (and big ones) that have opened up.. it just feels like all the big brands are desperatly trying to squeeze any growth they can out of the market, and taking bigger risks with areas that are already well served by their competetors..

Reply 10

Drewski

Original post by DJKL

Yes, but as they close some of their overlapping mega stores/ sheds they will open more of their smaller local stores which will drive even more independents out of business

Except in Tesco's case, when of the 43 stores they've announced to be closing, only a very small proportion are actually large stores, the bulk are Tesco Express and Tesco metro.

Reply 11

Rakas21

What annoys me most is when they end up with 3 or 4 stores in the same postcode.

Interestingly Indonesia passed a law a few years ago which prevents businesses having more than one outlet in a certain area. They did to protect local business and it may only have applied to food but an interesting idea.

Reply 12

Original post by Drewski

Except in Tesco's case, when of the 43 stores they've announced to be closing, only a very small proportion are actually large stores, the bulk are Tesco Express and Tesco metro.

I was not aware that was the case although by total turnover the larger store closures could by value be equal to the sum of the others.

I do not expect Tesco and the others stopping opening smaller targeted units, I know they have had agents enquiring as to unit availability within the last 2-3 months as my employer has had embryo discussions with one of the nationals re some retail units we own. I just expect the new openings to be far more targeted and less scatter gun in the future.

Reply 13

swanderfeild

10

Original post by thunder_chunky

Good. I have some sympathy for those who are losing their jobs, but I don't have sympathy for the company as a whole who have driven local high street shops to breaking point.

Its tough **** for local stores; why should consumer have to pay extra to keep those uncompetitive stores in business when supermarkets offers same service at better price?

Reply 14

Rakas21

Original post by swanderfeild

Its tough **** for local stores; why should consumer have to pay extra to keep those uncompetitive stores in business when supermarkets offers same service at better price?

The bigger problem for local stores is the range supermarkets offer because Brits are lazy and want convenience (only now pulling away from that but that may be recession mentality). As Schumpeter once said.. the corner shop should not fear it's price competitor, it should fear the business which innovates. In offering a larger range, the supermarkets have innovated and crushed smaller stores.

Reply 15

Original post by swanderfeild

Its tough **** for local stores; why should consumer have to pay extra to keep those uncompetitive stores in business when supermarkets offers same service at better price?

If looked at purely from a price perspective fair enough, but if a few large entities fully control the food supply chain and come to fully control UK agriculture not so good.

The amount of perfectly useable food that does not conform to the nationals standards re size/shape etc is awful.

So from a point of view of price as the sole metric fine, but from the point of view of long term land use and food security not that great.

( I used to have a client operating a dairy farm with their own bottling plant and delivery structure, once the supermarkets arrived in the local market and sold milk at less than production cost it killed their business, supermarkets can distort true market pricing with loss leaders)

Reply 16

thunder_chunky

Original post by swanderfeild

Its tough **** for local stores; why should consumer have to pay extra to keep those uncompetitive stores in business when supermarkets offers same service at better price?

The local stores only put up their prices to make up for the lack of business because of the large stores. So it's a vicious circle. The whole situation has gotten this way because of complacency and settling with the convenience the larger stores have to offer. The smaller stores do what they can do survive. I have less sympathy for larger companies like Tesco.

Reply 17

ForgetMe

Original post by Rakas21

What annoys me most is when they end up with 3 or 4 stores in the same postcode.

Interestingly Indonesia passed a law a few years ago which prevents businesses having more than one outlet in a certain area. They did to protect local business and it may only have applied to food but an interesting idea.

Agree.. Near me there's Tesco extra I believe, then about 10 minute walk there's another Tesco express and then after another 10-15 minute walk there's Tesco metro :erm:

Reply 18

Maid Marian

That makes me sad, I actually like Tesco. I should be pleased because I work for Asda, but I hate the thought of an ...American... company succeeding in Britain :grumble:

Reply 19

Joinedup