Tesco stays coy on plans for upmarket shop spin-off
Tesco is considering a trial of an upmarket convenience store under its ‘Tesco finest’ banner, but has not disclosed when or where a pilot will be launched.
Tesco hosted a capital markets day for analysts and investors earlier this week, at which it presented a slide flagging an opportunity for a ‘Tesco finest’ store concept with a 7% operating margin — significantly ahead of the group-wide target of 3.5% to 4%.
The premium ‘finest’ range of grocery products is Tesco’s most expensive.
“‘Tesco finest’ as a brand is one of the largest food brands in the country. We have a very high percentage of more upmarket customers,” chief executive Dave Lewis said.
The opportunity to curate that range and bring new things in a more convenient outlet is something that we have tested, is something we’re interested in.
But Mr Lewis said Tesco is “not at a place where we are saying we’re going to open this shop or this many shops.”
The CEO said the point of the capital markets day was to share with investors a number of growth opportunities Tesco is actively looking at without giving specific details on timings.
Other initiatives Tesco discussed this week include opportunities to sell more unique brands and online meal subscriptions, developing its Clubcard loyalty programme with a subscription model, setting up mini fulfillment centres at the back of stores for online grocery, and delivery robots.
