‘This is not just food…’: Tesco plots a chain of stores dedicated to its ‘Finest’ food range to take on M&S
- Tesco is mulling a new chain of shops dedicated to its Finest food range
- The upmarket chain would go head-to-head with grocery rival M&S
- It comes after Tesco launched a cut-price chain, Jacks, to take on Aldi and Lidl
Tesco could open a chain of shops dedicated to its upmarket Finest food range.
The supermarket unveiled the idea during a presentation to investors at a capital markets day in Welwyn Garden City, Hertfordshire, where it has its headquarters.
An illustration depicting the concept showed a store with the Tesco Finest banner over its doors and its premium products on display, alongside a cafe with indoor and outdoor seating.
Tesco unveiled the idea open a chain of shops dedicated to its Finest food range during a presentation to investors at a capital markets day
Tesco suggested the stores could be twice as profitable as its current shops.
Chief executive Dave Lewis wants to improve profitability to boost shareholder returns and acquire rival firms.
Tesco bought wholesaler Booker for £3.7billion in 2017, and just last year launched budget chain Jack’s in an attempt to fight off the growing threat posed by German discounters Lidl and Aldi.
A launch of Tesco Finest stores would see the UK’s largest grocer go head-to-head with upmarket rival Marks & Spencer.
The M&S Simply Food outlets are popular with middle-class customers and are known for their wide range of ready meals and sandwiches.
M&S has 700 of them in the UK but plans to open larger supermarkets, to attract more families for their weekly shop. But independent retail analyst Richard Hyman questioned the plans for a chain of Finest stores, noting that the launch of Jack’s had so far failed to threaten rivals.
‘Tesco is trying to be more like Lidl and Aldi and more like Marks & Spencer, but what about trying to be more like Tesco?’ he said. ‘Tesco is pretty good at being a middle-market brand.’
Tesco launched its Finest line just over two decades ago, made up of fresh and prepared products, such as chicken in prosecco sauce and cod and crab gratin.
It has since grown to now include around 900 products. Hyman added: ‘Finest was great when it first launched but I think it’s got too big with too many products.’
Tesco has rapidly expanded the number of own-brand products it stocks and last year carried out the biggest overhaul of its own-label range in its 100-year history in a bid to generate more sales.
During the presentation, Tesco also revealed it is testing a delivery robot which will allow customers to place an order through an app on their smartphones.
Rivals such as Ocado and Morrisons have ramped up investment in their technology in a bid to speed up delivery times for customers.
Tesco declined to comment.