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Tesco vows to rein in prices as profits treble amid rising sales

Linda Stewart — Wed, 13 Apr 2022 10:02:01 +0000

Tesco profits more than trebled last year amid rising sales and a fall in Covid-related costs.

The UK’s largest supermarket chain reported pre-tax profits of £2.03bn, up from £636m the previous year.

Group sales, excluding fuel, rose by 2.5% to £54.8bn, while in the UK retail sales rose by 2.3% year on year.

However, Tesco said performance would be affected by the the investment needed to keep prices down.

Chief executive Ken Murphy said: “Clearly, the external environment has become more challenging in recent months.

“Against a tough backdrop for our customers and with household budgets under pressure, we are laser-focused on keeping the cost of the weekly shop in check – working in close partnership with our suppliers, as well as doing everything we can to reduce our own costs.”

Mr Murphy added that Tesco was managing to keep the rise in the cost of living a “bit under the number for the overall market”.

He said strong product availability had been maintained but added that products such as sunflower oil were a challenge due to the war in Ukraine.

Tesco online business was lower as sales declined by 6.5% because some customers chose to return to shopping in stores as the pandemic eased.

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Poundland acquires Poundshop.com to power national online rollout

Linda Stewart — Tue, 01 Mar 2022 15:52:29 +0000

Poundland has completed the purchase of online discount retail business, Poundshop.com.

The acquisition of Poundshop.com is the next step in the transformation of Poundland and will provide the infrastructure to power a national roll-out of its own pilot ecommerce operation, the company said.

Founded in 2014, Poundshop.com has grown to be the UK’s largest online-only value retailer. Poundshop.com has almost 400,000 customers across the UK and 65 colleagues at its distribution centre and head office in Wednesbury, West Midlands, just a few miles from Poundland’s own customer support centre in Walsall.

Poundshop.com chairman, Steve Smith, and CEO Chris Maddox will act in an advisory capacity to help smooth the integration which will be led by Poundland retail and transformation director Austin Cooke who in turn will lead the day-to-day operation of Poundland’s online business.

The deal includes Poundshop.com’s intellectual property, its tried and tested online platform, the picking and fulfilment operations in Wednesbury and its customer database.

Poundland will retain all of the current Poundshop.com colleagues and during the integration process Poundshop.com will continue fulfilling customers’ orders as normal.

Expansion

Run by an experienced management team, Poundshop.com has expanded rapidly and last year alone saw sales more than double. It will continue trading under its own brand in the immediate term and will benefit from Poundland’s extended range and purchasing power to bring customers even more choice and value.

Poundland plans to build on the experience of Poundshop.com to develop further and scale up its own online operation which has started as a pilot in selected postcodes in Birmingham and Walsall and has now been successfully extended across the Midlands and into South Yorkshire.

Demand for Poundland’s pilot online service has been strong and has created excitement across the country for customers eager to access the service.

Helped by this acquisition, Poundland plans to widen its online offer, both in terms of ranges, adding PEP&CO clothing and homewares, and geographically, including extending beyond the UK and offering a Dealz online service for The Republic of Ireland.

After China and the US, the UK is the third-largest ecommerce market in the world, according to eMarketer’s research in 2022. It has always enjoyed a high penetration of online shoppers alongside physical retail which still accounts for the majority of sales.

The acquisition will accelerate the pace of the company’s plans to make its offer available on the web and means customers nationwide can look forward to shopping with Poundland at the click of a button in the near future.

The rollout of the online offer complements the opening of new stores and the expansion of ranges – from PEP&CO clothing to chilled and frozen food – as Poundland brings value for money shopping to even more customers at a time when every pound counts.

Barry Williams, Poundland managing director, said: “It’s great to warmly welcome the Poundshop.com team to Poundland. This acquisition puts power and pace behind our aspirations to make our amazing products and value available to customers across the UK and Ireland, however they choose to shop.”

Poundshop.com sells branded consumer products priced between £1 and £5 and typically below high street prices.

While it appeals to a broad range of shoppers and age groups, three quarters of its customers are female, and is particularly popular with 25–44-year-olds.

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Iceland to give away free food on last day of shelf life to online customers

Linda Stewart — Mon, 25 Oct 2021 11:53:35 +0000

Iceland has announced it will give food products on the last day of their shelf life away for free to online customers in an effort to reduce waste.

The supermarket says its ‘Free on Last Day of Life’ initiative has the potential to give away more than 1.3 million items worth £500,000 a year to Iceland’s customers while cutting food waste.

All food items ordered and delivered by Iceland have previously had a shelf life of at least two days.

The launch across all 1,000 of the supermarket’s sites follows a successful trial in 40 stores with more than 17,000 items given away for free and customers receiving an average refund of £1.58 per order.

The process does not require any additional action by the customer. If an item ordered is the only one left and has the same day date it will be scanned, labelled and placed in the shopping cart as normal.

The customer will be made aware of the free item ahead of delivery and will not be charged the original price.

All chilled, fresh, cakes, bread and morning goods will be included in the scheme.

‘Huge priority’

Iceland Foods managing director Richard Walker said: “Reducing food waste is a huge priority for us as we continue to reduce our impact on the environment.

“We know that shelf life plays a big role in the creation of surplus food so we to have find an innovative way to combat this within our stores and via our online shopping.

“Our Free on Last Day of Life scheme not only helps reduce food waste but also supports our customers.

“We know cost is key to many of our shoppers and this new initiative allows us to offer them the opportunity to reduce their weekly shopping bills as well as helping to reduce food waste.”

Meanwhile the premises leased to Iceland in Omagh has gone on the market for £625,000.

The retailer’s lease on the standalone Kevlin Road building dates back to 1995. Its current £70,000 a year lease, last renewed in 2015, runs until August 2025.

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