Tesco announces impressive £127m online profit, as new strategy unveiled

As British consumers’ love affair with discount retailers such as Lidl and Aldi continues, Tesco has come out swinging with a raft of measures to put the embattled chain back on track. During a strategy update yesterday, chief executive Philip Clarke announced that the supermarket’s online operation had raked in a staggering £127m profit last year.

The impressive figure came as the supermarket unveiled a suite of measures designed to get the retailer’s British business back on top after the discount stores outperformed the UK’s largest four supermarkets over the Christmas period.

Tesco’s plans, which were revealed at a presentation at the London Stock Exchange, will see £200m spent on price cuts and a slowdown in new store openings.

Tesco said that pricing had been “too volatile for too long”, and said that consumers would see a shift from confusing deals to a lowering of prices for core groceries such as carrots and cucumbers.

In addition, the supermarket will no longer be targeting a 5.2% profit margin.

The news that the online business has been so successful will come as a shock to the supermarket’s competitors as well as analysts who have said that the home delivery model has been a loss making enterprise. Asda and Sainsbury’s have both refused to provide figures for their online profits, while online-only business Ocado is yet to make a profit at all.

Now read:

Co-op to drop pharma and farmers after worst ever results

 

Social Bookmarks