Tesco

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For other uses, see Tesco (disambiguation).

Tesco plc

Trading name Tesco

Type Public limited company

Traded as LSE: TSCO

ISEQ: TCO

FTSE 100 Component

Industry Retailing

Founded 1919; 99 years ago

Hackney, London, England, UK

Founder Jack Cohen

Headquarters Tesco House

Shire Park

Kestrel Way

Welwyn Garden City

Hertfordshire

AL7 1GA

England

Number of locations 6,553 shops (2017)[1]

Area served United Kingdom, Ireland, India, Malaysia, Thailand,

Czech Republic, Hungary

 Key people
 John Allan (Non-Executive Chairman)

Dave Lewis (Group CEO)

Products Supermarket

Hypermarket

Superstore

Convenience shop

Revenue £55.9 billion (2017)[1]

Operating income £1,280 million (2017)[1]

Net income £(54) million (2017)[1]

Number of 476,000+ (2017)[2]

employees

Subsidiaries Tesco Stores Ltd.

Tesco Bank

Tesco Mobile

Tesco Ireland

Tesco Family Dining Ltd.

Dunnhumby

Spenhill

Booker Group

Jack's

Website www.tescoplc.com

Tesco plc, trading as Tesco, is a British multinational groceries and general merchandise retailer
with headquarters in Welwyn Garden City, Hertfordshire, England, United Kingdom.[3] It is the third-
largest retailer in the world measured by gross revenues[4][5] and ninth-largest retailer in the
world measured by revenues. It has shops in seven countries across Asia and Europe, and is the
market leader of groceries in the UK (where it has a market share of around 28.4%), Ireland,
Hungary[6] and Thailand.[7][8]
Tesco was founded in 1919 by Jack Cohen as a group of market stalls.[9] The Tesco name first
appeared in 1924, after Cohen purchased a shipment of tea from T. E. Stockwell and combined
those initials with the first two letters of his surname,[10] and the first Tesco shop opened in 1931
in Burnt Oak, Barnet.[11][12][13] His business expanded rapidly, and by 1939 he had over 100 Tesco
shops across the country.[14]
Originally a UK grocer, Tesco has expanded globally since the early 1990s, with operations in 11
other countries in the world. The company pulled out of the USA in 2013, but as of 2018 continues to
see growth elsewhere. Since the 1960s, Tesco has diversified into areas such as the retailing of
books, clothing, electronics, furniture, toys, petrol, software, financial services, telecoms, and
internet services. In the 1990s Tesco repositioned itself from being a down-market high-volume low-
cost retailer, to one designed to attract a range of social groups by offering products ranging from
low-cost "Tesco Value" items (launched 1993[9]) to its "Tesco Finest" range. This broadening of its
 appeal was successful and saw the chain grow from 500 shops in the mid-1990s to 2,500 shops
fifteen years later.[15]
Tesco is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had
a market capitalization of approximately £18.1 billion as of 22 April 2015, the 28th-largest of any
company with a primary listing on the London Stock Exchange.[16]

Contents

 1History
o 1.1Origins
o 1.2Expansion
o 1.3Diversification
o 1.4The lost years
 2UK operations
o 2.1Tesco Extra
o 2.2Tesco Superstores
o 2.3Tesco Express
o 2.4Tesco Metro
o 2.5One Stop
o 2.6Tesco.com Dark Stores
o 2.7Home shopping
o 2.8Tesco Clubcard
o 2.9Petrol stations
o 2.10Jack's
 3Subsidiaries
o 3.1Booker Group
o 3.2Tesco Bank
o 3.3Telecoms
o 3.4Tesco Tech Support
 4Former operations
o 4.1Tesco Home 'n' Wear
o 4.2Tesco Homeplus
o 4.3Dobbies Garden Centres
o 4.4Harris + Hoole
o 4.5Giraffe
o 4.6Euphorium Bakery
 5International operations
o 5.1Ireland
 6Corporate affairs
o 6.1Corporate strategy
o 6.2Financial performance
o 6.3Market share
o 6.4Corporate social responsibility
 7Advertising
 8Criticism
o 8.1Litigation
o 8.2Price-fixing
o 8.3Corporate tax structure
o 8.4Opposition to expansion
o 8.5Horse meat found in burgers
o 8.6Discrimination against the blind
o 8.7Slavery in Thailand
 o 8.8Sale of goods from Israel
o 8.9Sale of anti-semitic books
o 8.10Mothballing of new shops
o 8.11Security
o 8.12Suppliers
 9Chairmen of Tesco
 10See also
 11References
 12Further reading
 13External links

History
Origins
Jack Cohen, the son of Jewish migrants from Poland, founded Tesco in 1919 when he began to sell
war-surplus groceries from a stall at Well Street Market, Hackney, in the East End of London.[10] The
Tesco brand first appeared in 1924. The name came about after Jack Cohen bought a shipment of
tea from Thomas Edward Stockwell. He made new labels using the initials of the supplier's name
(TES), and the first two letters of his surname (CO), forming the word TESCO.[10] After experimenting
with his first permanent indoor market stall at Tooting in November 1930, Jack Cohen opened the
first Tesco shop in September 1931 at 54 Watling Street, Burnt Oak, Edgware,
Middlesex.[11][12][13] Tesco was floated on the London Stock Exchange in 1947 as Tesco Stores
(Holdings) Limited.[10] The first self-service shop opened in St Albans in 1956 (which remained
operational until 2010 before relocating to larger premises on the same street, with a period as a
Tesco Metro),[17] and the first supermarket in Maldon in 1956.[10] In 1961 Tesco Leicester made an
appearance in the Guinness Book of Records as the largest shop in Europe.[9]
Expansion

Tesco in Tiverton, Devon showing the former logo

During the 1950s and 1960s, Tesco grew organically, and also through acquisitions, until it owned
more than 800 shops. The company purchased 70 Williamson's shops (1957), 200 Harrow
Stores outlets (1959), 212 Irwins shops (1960, beating Express Dairies' Premier Supermarkets to the
deal), 97 Charles Phillips shops (1964) and the Victor Value chain (1968) (sold to Bejam in 1986).[18]
Jack Cohen's business motto was "pile it high and sell it cheap",[19] to which he added an internal
motto of "YCDBSOYA" (You Can't Do Business Sitting On Your Arse) which he used to motivate his
sales force.[19]
A branch of Tesco in Crediton

In May 1987, Tesco completed its hostile takeover of the Hillards chain of 40 supermarkets in the
North of England for £220 million.[20]
In 1994, the company took over the supermarket chain William Low after fighting off Sainsbury's for
control of the Dundee-based firm, which operated 57 shops. This paved the way for Tesco to expand
its presence in Scotland, in which its presence was weaker than in England.[21]
Tesco introduced a loyalty card, branded 'Clubcard' in 1995, and later an Internet shopping service.
In 1996 the typeface of the logo was changed to the current version with stripe reflections
underneath, whilst the corporate font used for shop signage was changed from the familiar
"typewriter" font that had been used since the 1970s. Overseas operations were introduced the
same year.[9] Terry Leahy assumed the role of Chief Executive on 21 February 1997, the
appointment having been announced on 21 November 1995.[22][23]
On 21 March 1997, Tesco announced the purchase of the retail arm of Associated British Foods,
which consisted of the Quinnsworth, Stewarts and Crazy Prices chains in Ireland and Northern
Ireland, and associated businesses, for £640 million.[24] The deal was approved by the European
Commission on 6 May 1997.[25]
The company was the subject of a letter bomb campaign lasting five months from August 2000 to
February 2001 as a bomber calling himself "Sally" sent letter bombs to Tesco customers and
demanded Clubcards modified to withdraw money from cash machines.[26]
Diversification

The first self-service Tesco shop in St Albans, Hertfordshire. The shop has since relocated.
Tesco in Tomaszów Mazowiecki, Poland

The company started to expand the range of products it sold during the 1960s to include household
goods and clothing under the Delamare brand, and in 1974 opened its first petrol station.[27][28][29]
In July 2001, Tesco became involved in internet groceries retailing in the USA when it obtained a
35% stake in GroceryWorks.[30] In 2002, Tesco purchased 13 HIT hypermarkets in Poland. It also
made a major move into the UK's convenience shop market with its purchase of T & S Stores, owner
of 870 convenience shops in the One Stop, Dillons and Day & Nite chains in the UK.[31]
In June 2003, Tesco purchased the C Two-Network in Japan.[32] It also acquired a majority stake in
Turkish supermarket chain Kipa.[33] In January 2004, Tesco acquired Adminstore, owner of 45
Cullens, Europa, and Harts convenience shops, in and around London.[34]
In Thailand, Tesco Lotus was a joint venture of the Charoen Pokphand Group and Tesco, but facing
criticism over the growth of hypermarkets CP Group sold its Tesco Lotus shares in 2003. In late
2005 Tesco acquired the 21 remaining Safeway/BP shops after Morrisons dissolved the Safeway/BP
partnership.[35] In mid-2006 Tesco purchased an 80% stake in Casino's Leader Price supermarkets in
Poland, which were then rebranded as small Tesco shops.[36]
On 9 February 2006, Tesco announced plans to move into the United States by opening a chain of
small format groceries in the Western states (Arizona, California and Nevada) in 2007 named Fresh
& Easy.[37]
In 2010, Tesco started funding a small film studio intended to produce Tesco exclusive direct-to-
DVD films. The first film was released on 6 September called Paris Connections, based on a popular
novel by Jackie Collins.[38][39]
The lost years
Tesco confirmed in April 2013 that it was pulling out of the US market (Fresh & Easy Stores), at a
reported cost of £1.2 billion.[40] In September 2013, Tesco announced that it would sell the business
to Ronald Burkle's Yucaipa Companies for an undisclosed amount.[41]
In September 2013, Tesco launched its first tablet computer, a seven-inch model called Hudl.[42]
Tesco purchased the restaurant and cafe chain Giraffe in 2013 for £48.6 million.[43] In 2014, it began
to open restaurants within some of its shops. The company set up Tesco Family Dining Ltd in 2014
as part of a new department called 'new food experience', including Core Cafes, Giraffe, Decks and
Euphorium bakeries. That year, Tesco reached an agreement to take the in-shop cafes run
by Compass Group and Elior back under its own control, so as to improve its dining offering.[44]
On 1 September 2014, Dave Lewis, previously of Unilever, took over as CEO.[45] In January 2015,
Lewis announced plans to close the company's head office in Cheshunt and 43 loss-making shops
in the near future, and the cancellation of 49 new large supermarket developments.[46] The shop
closures were expected to make 2,000 staff redundant, while a further £250 million of cost-cutting
measures were planned.[47]
Tesco also confirmed the sale of its Blinkbox on-demand video service and its fixed-line telephone
and broadband business to TalkTalk.[48] Tesco sold the Blinkbox Music streaming service
to Guvera on 26 January 2015,[49] and confirmed it would close its Blinkbox Books service by the end
of February 2015.[50]
In April 2016, Tesco confirmed the sale of 8.6% of its holding in Lazada Group, leaving it with an
8.3% stake. It was also reported to be seeking to sell Dobbies Garden Centres, Giraffe
Restaurants and Harris + Hoole to concentrate on its main supermarket business.[51]
On 27 January 2017, it was announced that Tesco had reached an agreement to merge with
Britain's biggest wholesaler Booker Group to create the UK's largest food group, there are however
concerns over market dominance with Tesco being Britain's largest food retailer and Booker being
the UK's largest wholesaler.[52]
It was announced in March 2017 that Trevor Masters, International Chief Executive, would be
leaving in May after 38 years with the company. On 1 April, Tony Hoggett became Tesco's CEO for
Asia, and Matt Simister became CEO for Central Europe.[53]
In April 2017, the company confirmed it would sell its in-shop opticians' business to Vision Express.[54]
In June 2017, Tesco announced a major cost-cutting initiative that would reduce the company's
workforce by over 1,200 workers. Key reductions included over a quarter of its employees in Welwyn
Garden City and Hatfield, and the closure of the call centre in Cardiff. The company hoped to reduce
costs by £1.5 billion.[55]

UK operations
As of 2017, Tesco's UK shop portfolio was as follows:[1]
Total Total Mean Mean Percentage +/- Shops
Format Number
area (m²) area (sq ft) area (m²) area (sq ft) of space 2016
Tesco Extra 252 1,648,842 17,748,000 6,543 70,429 44.53%
Tesco Superstore 479 1,307,610 14,075,000 2,730 29,384 35.32% 1
Tesco Express 1,740 376,629 4,054,000 216 2,330 10.17% 8
Tesco Metro 176 185,156 1,993,000 1,052 11,324 5.00% 1
One Stop 780 117,894 1,269,000 151 1,627 3.18% 1
Tesco Dotcom only 6 66,519 716,000 11,086 119,333 1.80%
Dobbies 0 0 0 0 0 0.00% 36
Total 3,433 3,702,649 39,855,000 1,079 11,609 100.00% 27

Tesco Extra

Tesco shop at Kingston Park, Newcastle upon Tyne

Tesco Extra shops are larger, mainly out-of-town hypermarkets that stock nearly all of Tesco's
product ranges, although some are in the heart of town centres and inner-city locations. The largest
shop in England by floor space is Tesco Extra in Walkden, with 17,230 square metres
(185,500 sq ft) of floorspace.[56]
In common with other towns, such as Warrington,[57] the St Helens shop, which at
13,000 m2 (140,000 sq ft) is one of the biggest in England, was developed on the same site as the
town's new rugby league stadium.[58]
Tesco Superstores

Potters Bar Tesco

Tesco Superstores are standard large supermarkets, stocking groceries and a much smaller range
of non-food goods than Extra hypermarkets. The shops have always been branded as 'Tesco', but a
new shop in Liverpool was the first to use the format brand 'Tesco Superstore' above the door.[59]
Tesco operates a number of in-shop cafes, but also began to introduce new restaurants in its shops
from 2013 under the "Decks Carvery" brand.[60]
Tesco Express

Tesco Express, Hilperton Road, Trowbridge, Wiltshire

Tesco Express shops are neighbourhood convenience shops averaging 200 square metres
(2,200 sq ft), stocking mainly food with an emphasis on higher-margin products such as sweets,
crisps, chocolate, biscuits, fizzy drinks and processed food (due to small shop size, and the
necessity to maximize revenue per square foot) alongside everyday essentials. They are located in
busy city-centre districts, small shopping precincts in residential areas, small towns and villages, and
on Esso petrol station forecourts. In 2010 it became known that Tesco was operating Express
pricing, charging more in their Express branches than in their regular branches. A spokesperson
said that this was "because of the difference in costs of running the smaller shops".[61]
Tesco Metro
Tesco Metro shops are sized between Tesco superstores and Tesco Express shops, with shops
averaging 1,000 square metres (11,000 sq ft). They are mainly located in city centres beside railway
stations, the inner city and on the high streets of towns.[62]
One Stop

One Stop, Trowbridge, Wiltshire

One Stop, which includes some of the smallest shops (smaller than a Tesco Express), is the only
Tesco shop format in the UK that does not include the word Tesco in its name. The brand, along
with the original shops, formed part of the T&S Stores business but, unlike many that were
converted to Tesco Express, these kept their old name. Subsequently, other shops bought by Tesco
have been converted to the One Stop brand. Some have Tesco Personal Finance branded cash
machines. The business has attracted some controversy, as the prices of groceries in these shops,
often situated in more impoverished areas, can be higher than nearby Tesco branded shops,
highlighted in The Times 22 March 2010: "Britain’s biggest supermarket uses its chain of 639 One
Stop convenience shops–which many customers do not realise it owns–to charge up to 14 per cent
more for goods than it does in Tesco-branded shops."[63]
Tesco responded to the article stating "It is a separate business within the Tesco Group, with its own
supply chain and distribution network. One Stop shops offer a different range to Express shops and
its operating costs are different. One Stop’s price strategy is to match to its nearest
competitor, Costcutter, and is frequently cheaper."[64]
Tesco.com Dark Stores
Since 2006 Tesco has operated a number of dark stores dedicated to the fulfilment of online orders
of groceries:[65]

 Pick from store like operation:

 Croydon
 Pick from store like operation with mechanised delivery marshalling:
 Aylesford
 Greenford
 Combination of pick from store and zone picking operations with mechanised delivery
marshalling:
 Enfield
 Crawley
 Combination of pick from store, zone picking and goods to person operations with mechanised
delivery marshalling:
 Erith
Home shopping
Main article: Tesco.com
In the United Kingdom Tesco operates a home shopping service through the Tesco.com website. In
May 1984, in Gateshead, England, Mrs. Jane Snowball used a piece of computer technology called
"Videotex" on her television to purchase groceries from her local Tesco shop in the world's first
recorded online shopping transaction from the home.[66][67][68] As of November 2006, Tesco was the
only food retailer to make online shopping profitable.[69]
Tesco Clubcard
Main article: Tesco Clubcard
Tesco launched its customer loyalty scheme, the Tesco Clubcard, in 1995. It has been cited as a
pivotal development in Tesco's progress towards becoming the UK's largest supermarket chain and
one that fundamentally changed the country's supermarket business.[70] Tesco itself was cited in
a Wall Street Journal article as using the intelligence from the Clubcard to thwart Wal-Mart's
initiatives in the UK.[71]
Cardholders can collect one Clubcard point for every £1 (or one point for €1 in Ireland and Slovakia
or 1 point for 1zł in Poland) they spend in a Tesco shop, or at Tesco.com, and 1 point per £2 on fuel
(not in Slovakia). Customers can also collect points by paying with a Tesco Credit Card, or by using
Tesco Mobile, Tesco Homephone, Tesco Broadband, selected Tesco Personal Finance products or
through Clubcard partners, E.ON and Avis. Each point equates to 1p in shops when redeemed, or
up to four times that value when used with Clubcard deals (offers for holidays, day trips, etc.)
Clubcard points (UK & IE) can also be converted to Avios and Virgin Atlantic frequent flyer miles.[72]
Petrol stations

A 24-hour Tesco petrol station

Tesco first started selling petrol in 1974. Tesco sells 95, 97 and 99 RON (a fuel developed
by Greenergy of which Tesco is a shareholder) petrol from forecourts at most Superstore and Extra
locations. Tesco have recently diversified into biofuels, offering petrol-bioethanol and diesel-
biodiesel blends instead of pure petrol and diesel at their petrol stations, and now offering Greenergy
100% biodiesel at many shops in the southeast of the United Kingdom. In 1998, Tesco
and Esso (part of Exxonmobil) formed a business alliance that included several petrol filling stations
on lease from Esso, with Tesco operating the attached shops under their Express format. In turn,
Esso operates the forecourts and sells their fuel via the Tesco shop.[73] As of 2013, there were 200
joint Tesco Express/Esso sites in the UK.[74]
Jack's

Jack's supermarket in Chatteris, Cambridgeshire, the first store using this brand to open in September 2018.

Main article: Jack's (store)

In 2018, Tesco launched a separate budget chain, Jack's, to compete with Lidl and Aldi; the first
store opened in Chatteris, Cambridgeshire in September 2018.[75]

Subsidiaries
Booker Group
Main article: Booker Group
Tesco completed its acquisition of the food wholesaler Booker in March 2018. Booker also owns
the Budgens, Londis, Euro Shopper and Premier Stores brands which operate under franchises.[76]
Tesco Bank
Main article: Tesco Bank
In the United Kingdom Tesco offers financial services through Tesco Bank, formerly a 50:50 joint
venture with The Royal Bank of Scotland. Products on offer include credit cards, loans, mortgages,
savings accounts and several types of insurance, including car, home, life and travel. They are
promoted by leaflets in Tesco's shops and through its website. The business made a profit of
£130 million for the 52 weeks to 24 February 2007, of which Tesco's share was £66 million. This
move towards the financial sector diversified the Tesco brand and provides opportunities for growth
outside of the retailing sector. On 28 July 2008, Tesco announced that they would buy out the Royal
Bank of Scotland's 50% stake in the company for £950 million.[77]
Telecoms
Further information: Tesco Mobile
Tesco operates a mobile phone business across the United Kingdom, Ireland, Slovakia, Hungary
and the Czech Republic. It first launched in the UK in 2003 as a joint venture with O2 and operates
as a mobile virtual network operator (MVNO) using the network of O2 with the exceptions of
Hungary where the network of Vodafone Hungary is used and Ireland where Three Ireland is used.
As a virtual operator, Tesco Mobile does not own or operate its own network infrastructure. By
January 2011 Tesco announced it had over 2.5 million UK mobile customers.[78]
Tesco also operated a home telephone and broadband business. Its broadband service launched in
August 2004 to complement its existing internet service provider business, providing an ADSL-based
service delivered via BT phone lines.[79] In January 2015, Tesco sold its home telephone and
broadband business, together with Blinkbox, to TalkTalk for around £5 million. Its customers were
transferred by 2016.[48][80]
Tesco Tech Support
Tesco acquired a small I.T. support company called The PC Guys in 2007,[81] and were able to
launch Tesco Tech Support in December 2008.[82]

Former operations
Tesco Home 'n' Wear
In the 1960s, Tesco set up a non-food division, Tesco Home 'n' Wear, headed by Leslie Porter. It
had stand-alone shops and departments in larger shops, and from 1975 a distribution centre
in Milton Keynes. Although Tesco continued to stock non-food items the stand-alone shops were
closed and the name was no longer in use when Tesco Extra was launched.[83][84][85]
Tesco Homeplus
Total Total Mean Mean Percentage +/- Shops
area (m²) area (sq ft) area (m²) area (sq ft) of space 2014
48,588 523,000 4,049 43,583 1.27% 11
In May 2005, Tesco announced a trial non-food only format near Manchester and Aberdeen,[86] and
the first shop opened in October 2005. The shops offered all of Tesco's ranges except food in
warehouse-style units in retail parks. Tesco introduced the format as only 20% of its customers had
access to a Tesco Extra, and the company was restricted in how many of its superstores it could
convert into Extras and how quickly it could do so. Large units for non-food retailing are much more
readily available. The format was not Tesco's first non-food only venture in the UK. Until the late
1990s/early 2000s there were several non-food Tesco shops around the country including
Scarborough and Yate. Although not in a warehouse-style format, the shops were located on high
streets and shopping centres, and stocked similar items to Homeplus shops. In both cases this was
because another part of the shopping centre had a Tesco Superstore that stocked food items only.
By 2014, the number of Homeplus shops in the United Kingdom had reached 12; the newest shop
opened in Chester in July 2009. In 2012 it was reported that Tesco was looking to close the
business to focus on groceries.[87] Tesco closed six Homeplus shops on 15 March 2015,[47] and the
remaining six shops closed on 27 June 2015.[88]
Dobbies Garden Centres
Main article: Dobbies Garden Centres
Total Total Mean Mean Percentage +/- Shops
area (m²) area (sq ft) area (m²) area (sq ft) of space 2014
152,175 1,638,000 4,476 48,176 3.99% 1

Dobbies Garden Centre in Lasswade, Scotland

Dobbies is a chain of garden centres across Scotland, England and Northern Ireland. Tesco
completed its acquisition of Dobbies in 2008, and the company continued to trade under its own
brand, from its own head office in Melville, near Edinburgh. On 17 June 2016, Tesco sold the
company on to a group of investors led by Midlothian Capital Partners and Hattington Capital for
£217 million.[89]
Harris + Hoole
Main article: Harris + Hoole
In 2012, Tesco invested in a new coffee shop chain, named Harris + Hoole after coffee-loving
characters in Samuel Pepys' diary.[90] Tesco took full ownership of the business from its founders
Nick, Andrew and Laura Tolley in February 2016,[91] and agreed in June 2016 to sell it to Caffè
Nero.[92]
Giraffe
Giraffe is a restaurant chain in the United Kingdom which Tesco purchased in March 2013 as part of
a strategy of making use of excess space in its shops. Tesco sold the chain to Boparan Holdings in
June 2016.[93]
Euphorium Bakery
Euphorium Bakery opened a concession in Tesco's Kensington shop in 2012, and in 2013 Tesco
bought a stake in the business. It purchased the remaining stake in April 2015.[94] In August 2016,
Tesco sold Euphorium's high street shops and factory in Islington to Soho Coffee, and its factory
in Weybridge to Samworth Brothers.[95]

International operations
Main article: Tesco International operations
Tesco has expanded its operations outside the UK to 11 other countries in the world. The company
pulled out of the USA in 2013, but as of 2018 continues to see growth elsewhere. Tesco's
international expansion strategy has responded to the need to be sensitive to local expectations in
other countries by entering into joint ventures with local partners, such Charoen Pokphand in
Thailand to form Tesco Lotus, and by appointing a very high proportion of local personnel to
management positions. It also makes small acquisitions as part of its strategy: for example, in its
2005/2006 financial year it made acquisitions in South Korea, one in Dubai, UAE; one in Poland and
one in Japan.[96] On 7 September 2015, Tesco sold its South Korean business, Homeplus, to MBK
Partners and partnered with a Canadian pension fund and Temasek Holdings for the deal.[97]
Ireland
Main article: Tesco Ireland
Tesco Ireland was formed by the Tesco PLC 1997 takeover of the Irish retailing operations of
Associated British Foods, namely Powers' Supermarkets Limited and its subsidiaries, trading as
"Quinnsworth" and "Crazy Prices".[98]

Corporate affairs
Corporate strategy

New Tesco House, Tesco's former head office, in Cheshunt, Hertfordshire

According to Citigroup retail analyst David McCarthy, "[Tesco has] pulled off a trick that I'm not
aware of any other retailer achieving. That is to appeal to all segments of the market".[99] One plank of
this strategy has been Tesco's use of its own-brand products, including the upmarket "Finest", mid-
range Tesco brand and low-price "Value" encompassing several product categories such as food,
beverage, home, clothing, Tesco Mobile and financial services.[100]
Beginning in 1997 when Terry Leahy took over as CEO, Tesco began marketing itself using the
phrase "The Tesco Way" to describe the company's core purposes, values, principles, and
goals[101] This phrase became the standard marketing speak for Tesco as it expanded domestically
and internationally under Leahy's leadership, implying a shift by the company to focus on people,
both customers and employees.[102]
A core part of the Tesco expansion strategy[103] has been its innovative use of technology.[104] It was
one of the first to build self-service tills and use cameras to reduce queues, and an early adopter
of NFC contactless payment card technology.[105] In 2016, Tesco developed a mobile payment wallet,
PayQwiq using both NFC contactless and barcode technology to allow payment using mobile
phones in-shop (along with supporting other contactless mobile wallets such as ApplePay).[106]
Financial performance
All figures below are for the Tesco's financial years, which run for 52- or 53-week periods to late
February. Up to 27 February 2007 period end the numbers include non-UK and Ireland results for
the year ended on 31 December 2006 in the accounting year. The figures in the table below include
52 weeks/12 months of turnover for both sides of the business as this provides the best
comparative.
52/3 weeks ended Turnover (£m) Profit before tax (£m) Profit for year (£m) Basic earnings per share (p)
25 February 2017[1] 55,917 145 (54) (0.49)
28 February 2016[1] 53,933 202 129 1.70
28 February 2015 62,284 (6,376) (5,766) (70.82)
22 February 2014 70,894 3,054 2,259 32.05
23 February 2013 64,826 3,549 3,453 35.97
25 February 2012 64,539 3,985 2,814 34.98
26 February 2011 67,573 3,535 2,671 33.10
27 February 2010 62,537 3,176 2,336 31.66
28 February 2009 54,300 3,128 2,166 28.92
23 February 2008 47,298 2,803 2,130 26.95
24 February 2007 46,600 2,653 1,899 22.36
25 February 2006 38,300 2,210 1,576 19.70
26 February 2005 33,974 1,962 1,366 17.44
28 February 2004 30,814 1,600 1,100 15.05
22 February 2003 26,337 1,361 946 13.54
23 February 2002 23,653 1,201 830 12.05
24 February 2001 20,988 1,054 767 11.29
26 February 2000 18,796 933 674 10.07
27 February 1999 17,158 842 606 9.14
28 February 1998 16,452 760 532 8.12

Despite being in a recession, Tesco made record profits for a British retailer in the year to February
2010, during which its underlying pre-tax profits increased by 10.1% to £3.4 billion. Tesco then
planned to create 16,000 new jobs, 9,000 in the UK.[107] In 2011 the retailer reported its poorest six-
monthly UK sales figures for 20 years, attributed to consumers' reduced non-food spending and a
growth in budget rivals.[108]
By 2014, Tesco appeared to have lost some of its appeal to customers.[109] The share price lost 49
per cent of its value up to October as it struggled to fend off competition from rivals Aldi and Lidl.[110]In
October 2014, Tesco suspended 8 executives following its announcement the previous month that it
had previously overstated its profits by £250 million. The misreporting resulted in almost £2.2 billion
being wiped off the value of the company’s stock market value. The suspended executives included
former commercial director Kevin Grace and UK managing director Chris Bush.[111][112] The profit
overstatement was subsequently revised upwards to £263 million following an investigation by the
accountancy firm Deloitte, and it was clarified that the inflated profit figure was the result of Tesco
bringing forward rebates from suppliers. The Serious Fraud Office (SFO) confirmed on 29 October
2014 that it was carrying out a criminal investigation into the accounting irregularities but declined to
give further details.[113]
Market share

UK market share

According to Kantar Worldpanel, Tesco's share of the UK groceries market in the 12 weeks to 18
March 2012 was 30.2%, down from 30.6% in the 12 weeks to 18 March 2011.[114]
Market share +/- from In terms of the wider UK retail market, Tesco sales
Supermarket
March 2012 March 2011
account for around one pound in every ten spent in
Tesco 30.2% 0.4% British shops.[115] In 2007 it was reported that its share
Asda 17.9% 0.6% was even larger, with one pound in every seven spent
Sainsbury's 16.6% 0.0%
going to Tesco.[116] In 2006, Inverness was branded as
"Tescotown",[117][118] because well over 50p in every £1
Morrisons 12.3% 0.0% spent on food is believed to be spent in its three Tesco
The Co-operative Food 6.9% 0.4% shops.[119] By 2014 competition from other retailers led
to a fall in Tesco's market share to 28.7%; this was the
lowest level in a decade.[120]
Corporate social responsibility
Tesco made a commitment to corporate social responsibility in the form of contributions of 1.87% in
2006 of its pre-tax profits to charities and local community organizations.[121] This compares
favourably with Marks & Spencer, whose 1.51% is lower than Sainsbury's 7.02%.[122] This figure,
£42 million, is lower than the amount of money reported to have been avoided in tax during 2007
(see below). Will Hutton, in his role as chief executive of The Work Foundation, in 2007 praised
Tesco for leading the debate on corporate responsibility.[123] However Intelligent Giving has criticized
the company for directing all "staff giving" support to the company's Charity of the Year.[124]

Tesco in Evesham

In 1992, Tesco started a "computers for schools scheme", offering computers in return for vouchers
given to Tesco customers and donated by them to schools and hospitals. Until 2004, £92 million of
equipment went to these organizations. The scheme was also implemented in Poland.[125]
In 2009, Tesco used the phrase, "Change for Good" as advertising, which is trade marked
by Unicef for charity usage but not for commercial or retail use, which prompted the agency to say,
"It is the first time in Unicef’s history that a commercial entity has purposely set out to capitalise on
one of our campaigns and subsequently damage an income stream which several of our
programmes for children are dependent on." They went on to call on the public "...who have
children’s welfare at heart, to consider carefully who they support when making consumer
choices."[126][127]
Tesco's own-labels personal care and household products are stated to be cruelty-free, meaning
that they are not tested on animals.[128]
In June 2011, Tesco announced that it was working with 2degrees Network to create an online hub
as part of its target to reduce its supply chain carbon footprint by 30% by 2020.[129]
In September 2011 a Greenpeace report revealed that Tesco supermarkets in China were selling
vegetables that contained pesticides at levels exceeding the legal limit, or were illegal. A green
vegetable sample from Tesco turned up methamidophos and monocrotophos, the use of which has
been prohibited in China since the beginning of 2007.[130]

Advertising

Prunella Scales, as Dotty Turnbull arguing about Tesco prices

A notable 1980s advert was "Checkout 82," which was made in 1982, where a till would have a
receipt coming out of it with the prices on. This advert had synthpop music as the backing and
people singing "Check it out, check it out".[131]
Adverts in the early 1990s had a man called David, portrayed by Dudley Moore, on the hunt for free-
range chickens from France and discovering many goods from around the world to purchase for
Tesco.[132] Late 2000s adverts included many celebrities and celebrity voice-overs such as The Spice
Girls and the voice of actors James Nesbitt and Jane Horrocks.[133]
Tesco's main advertising slogan is "Every little helps". Its advertisements in print and on television
mainly consist of product shots (or an appropriate image, such as a car when advertising petrol)
against a white background, with a price or appropriate text (e.g., "Tesco Value") superimposed on a
red circle.[134]
Tesco's in-shop magazine is one of the largest-circulation magazines in the United Kingdom, with a
circulation of 1.9 million as of 2013.[135]
In November 2013, Tesco announced they would introduce face-scanning technology developed
by Amscreen at all of their 450 UK petrol stations to target advertisements to individual
customers.[136][137]

Criticism
Main article: Criticism of Tesco
Criticism of Tesco includes allegations of stifling competition due to its undeveloped "land
bank",[138] and breaching planning laws.[139]
Litigation
The Tesco supermarket chain is involved in litigation such as the Ward v Tesco Stores
Ltd and Tesco Supermarkets Ltd v Nattrass cases. Tesco have been criticized for aggressively
pursuing critics of the company in Thailand. Writer and former MP Jit Siratranont faced up to two
years in jail and a £16.4 million libel damages claim for saying that Tesco was expanding
aggressively at the expense of small local retailers. Tesco served him with writs for criminal
defamation and civil libel. The Thai court dismissed the case, ruling that the criticism made by the
defendant was 'in good faith by way of fair comment on any person or thing subjected to public
criticism'.[140]
In November 2007, Tesco sued a Thai academic and a former minister for civil libel and criminal
defamation, insisting that the two pay £1.6 million and £16.4 million plus two years' imprisonment
respectively. They have been alleged to have misstated that Tesco's Thai market amounts to 37% of
its global revenues, amongst criticism of Tesco's propensity to put small retailers out of business.[141]
In August 2013, Tesco was fined £300,000 after admitting that it misled customers over the pricing
of "half price" strawberries.[142]
Price-fixing
In 2007, Tesco was placed under investigation by the UK Office of Fair Trading (OFT) for acting as
part of a cartel of five supermarkets (Safeway, Tesco, Asda, Morrisons and Sainsburys) and a
number of dairy companies to fix the price of milk, butter and cheese. In December 2007, Asda,
Sainsburys and the former Safeway admitted that they acted covertly against the interests of
consumers while publicly claiming that they were supporting 5,000 farmers recovering from the foot-
and-mouth crisis. They were fined a total of £116 million.[143]
Corporate tax structure
In May 2007, it was revealed that Tesco had moved the head office of its online operations to
Switzerland. This allows it to sell CDs, DVDs and electronic games through its web site without
charging value-added tax (VAT).[144] The operation had previously been run from Jersey, but had
been closed by authorities who feared damage to the island's reputation.[144] In June 2008, the
government announced that it was closing a tax loophole being used by Tesco.[145] The scheme,
identified by British magazine Private Eye, utilized offshore holding companies in Luxembourg and
partnership agreements to reduce corporation tax liability by up to £50 million a year.[145] Another
scheme previously identified by Private Eye involved depositing £1 billion in a Swiss partnership,
and then loaning that money to overseas Tesco shops, so that profit could be transferred indirectly
through interest payments. This scheme was still in operation in June 2008 and was estimated to be
costing the UK exchequer up to £20 million a year in corporation tax.[145] Tax expert Richard Murphy
has provided an analysis of this avoidance structure.[146]
Tax avoidance has not always related to corporation tax. A number of companies including Tesco
used a scheme to avoid VAT by deeming 2.5% of purchases paid for by card to be a 'card
transaction fee', which reduced the company's tax liability without changing the charge to the
customer. Such schemes came to light after HMRC litigated against Debenhams over the scheme in
2005.[147]
Opposition to expansion
Tesco Express Harpenden, Hertfordshire

Tesco's expansion has been criticised, and in some cases actively opposed.

 In March 2007, residents in Bournville, Birmingham fought to maintain the historic alcohol-free
status of the area, in winning a court battle with Tesco, to prevent it selling alcohol at their local
outlet. No shops are permitted to sell alcohol in the area and there are no pubs, bars or fast-food
outlets in Bournville due to its Quaker roots.[148]
 Plans for a large Tesco shop in St Albans, Hertfordshire, attracted widespread local opposition.
This led to the formation of the "Stop St Albans Tesco Group". In June 2008, St Albans Council
refused planning permission for the proposed new shop.[149]
 In April 2011, longstanding opposition to a Tesco Express shop in Cheltenham Road, Stokes
Croft, Bristol, evolved into a violent clash between opponents and police. The recently opened
shopfront was heavily damaged, and police reported the seizure of petrol bombs.[150] Opponents
have suggested that the shop would damage small shops and harm the character of the area.[151]
Horse meat found in burgers
Main article: 2013 meat adulteration scandal
In January 2013, the British media reported that horse meat had been found in some meat products
sold by Tesco, along with other retailers, particularly burgers. Prime Minister David Cameron called
this "unacceptable", with products showing 29.1% horse meat in the "Value" range burger, which
were supposed to be beef.[152][153] It was later revealed in February 2013 that some of Tesco's
Everyday Value Spaghetti Bolognese contained 60% horse meat.[154] Tesco withdrew 26 of its
products in response, and announced that they were working with authorities and the supplier to
investigate the cause of the contamination.[155]
Discrimination against the blind
In July 2013 Tesco security staff violated the UK Equality Act 2010 by refusing to allow a blind lady's
guide dog to enter the Feltham shop. Tesco staff refused to apologise for the violation of the law for
5 days.[156] It was also revealed that security staff had thrice previously ordered a different blind
person and his guide dog to leave the shop.[157] Following further incident in 2013 when the manager
of Tesco in Sutton ordered a blind person and her guide dog to leave the shop, Tesco stated that
their staff had received training to ensure that such an incident would not happen again.[158] However,
a year later in 2014 three Tesco cashiers banned a blind person and her dog from their shop.[159]
Slavery in Thailand
In 2014, The Guardian reported that Tesco is a client of Charoen Pokphand Foods. Over 6
months The Guardian traced the whole chain from slave ships in Asian waters to leading producers
and retailers.[160]
Sale of goods from Israel
Tesco has been targeted by protesters complaining the supermarket chain sells goods made in
Israel, with most complaints being about products emanating from Israeli settlements in the West
Bank. Protests generally occur when Israeli military operations are being carried out in the Gaza
Strip or the West Bank. A protester was arrested at a protest at a shop in Birmingham on 16 August
2014.[161]
Sale of anti-semitic books
Searchlight magazine said it was "horrified" to discover anti-semitic books by US extremist publisher
Liberty Bell on the Tesco website. Titles offered for sale included The Hitler We Loved and Why, The
International Jew and The Protocols of the Elders of Zion. Searchlight found another 106 titles by
British-based publisher Steven Books which it describes as "so extreme that even the British
National Party does not sell them". The shop said in a statement: "Tesco.com has over one million
book titles covering a wide range of subjects. We are unhappy that titles which could cause offence
to some customers have found their way on to our site and took immediate action to remove them
once they were brought to our attention."[162]
Mothballing of new shops
Tesco's financial crisis of 2014[163] led to their reducing their capital expenditure on new shops, which
led to the boarding up of new unopened shops
in Chatteris, Cambridgeshire[164] and Immingham, Lincolnshire.[165] The controversial Chatteris
mothballing caused local criticism after the £22 million project had re-routed a river and built a
controversial roundabout and underpass, whereas the much anticipated Immingham development
demolished a local shopping centre and closed several local shops to enable its construction. The
impending arrival of Tesco also contributed to the Co-operative's decision to close their shop in the
town.[166] Tesco's announcing the indefinite delay in their shop opening left the town of around 15,000
inhabitants without a supermarket. Tesco went ahead with the opening of shops in Little
Lever,[167] Dunfermline[168] and Rotherham.[169]
Security
On 17 July 2015 Tesco disabled their online photo site as part of a precautionary security
measure.[170] This coincided with several other retailers, including CVS and Walmart Canada, shutting
down similar services regarding a security breach at PNI Digital Media.[171]
Suppliers
The UK Groceries Code Adjudicator found in a 2015–16 investigation into Tesco that some suppliers
paid "large sums of money in exchange for category captaincy or participation in a price review". She
found some evidence of benefits which suppliers derive from these arrangements, but also recorded
a concern—to be investigated further—as to whether the purpose of the Groceries Code was being
circumvented by these payments.[172]

Chairmen of Tesco
 1947–1970: Sir Jack Cohen
 1970–1973: Hyman Kreitman
 1973–1985: Sir Leslie Porter
 1985–1997: Lord MacLaurin
 1997–2004: John Gardiner
 2004–2011: Sir David Reid
 2011–2015: Richard Broadbent
 March 2015–present: John Allan