Tesco have announced they are to close 43 unprofitable stores amid faltering profits and caution from investors. The stores being closed primarily fall into the ‘Express’ labelled smaller stores of the brand. Plans have also been announced to delay or cancel the openings of 49 ‘large’ Tesco Extra stores. The chain have also began a major restructure of spending by ending their pension scheme for staff, making cuts of £250m pounds and reducing overheads by 30%.
Tesco have moved quickly to instil confidence in their investors amid a bad 2014, which saw an investigation into their accounts, as well as falling sales in store and outrage at the chaos caused by inadequate preparation for the Black Friday sales.
However the retail giant, which has more than 3,300 stores in the UK has reacted quickly in order to resolve problems and has reported better sales over the festive period as a result of “listening to customers” according to Tesco’s chief executive, Dave Lewis.
Sales over the holiday period were down just 0.3% on the year before, and up 0.1% if fuel sales are included. Overall, comparable sales for the three months to the beginning of January were down by 2.9%. This is welcome news as in the previous three months sales had dropped by 5.4%.
Dave Lewis said the firm was “facing the reality of the situation” and was “seeing the benefits of listening to our customers”.
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