As Tesco creates a new position for a Managing Director to oversee its operations in London, what does this mean for its strategy in the capital in terms of how its business develops going forward?
Getting serious about the London opportunity
Andrew Yaxley was moved from his position as UK Commercial Director for Fresh Food last October and will now take on the responsibility for all formats in the London area. Tesco trades over 500 stores within the M25, ranging across all formats from Express, to Metro, Superstores and Extra, plus a rapidly growing capability to deliver online retailing. Tesco for a while has been making signs that London holds more opportunity than it believes is currently being sought out and this new role shows a growing desire by the retailer to put dedicated resource behind the model.
Convenient solutions, premium ranges and online capability - just the start?
Over the last few years we have seen Tesco develop its business in order to better serve the demanding requirements of the London consumer. A stronger focus on Express has allowed the retailer to open more stores within the M25 and focus to delivering more convenient solutions for the busy London shopper. Developments in range, such as the introduction of its Finest Restaurant Quality ready meals, as well as more upmarket 'London' formats, have helped deliver a more premium offering. And finally, its growing strategy of opening dark stores in and around London has rapidly increased its capacity with which to serve the capital with online retailing, the best ranges and also free up trading pressure on busy 'big box' stores.
Greater focus on London formats will deliver new opportunities
The new role will most likely allow Andrew Yaxley to shape the strategy for Tesco's London operations. Undoubtedly, his initial priorities will be to continue the good work that Tesco has already done in the capital and help lead the continuing development of smaller formats and dark stores. However, in the medium to longer term the position could open up an evolution in thinking for Tesco's formats in London. Not just in terms of the in-store look and feel but also the ranges they carry, the solutions they deliver and the seamless online and offline experience that Tesco CEO Philip Clarke has talked about previously at a number of high profile events. A greater focus on London formats will lead to the introduction of new initiatives and ultimately deliver many new and exciting opportunities for suppliers to engage with the retailer.
More personalisation for highly expectant shoppers
Commenting on Yaxley's new role a Tesco spokesperson said, 'Andrew will be taking on the new role of MD for London, responsible for all formats in the London area. This is in recognition of the importance of London to Tesco - its diversity presents us with huge opportunities, as we work towards giving shoppers more personalisation in a city where shopping habits change rapidly and customer expectations are extremely high. We’ve already started work on building a better Tesco for our London customers, for example opening a new dotcom centre in Crawley and another being built in Erith to give a better service to our online customers. We’re also focusing on getting the right ranges and products in each store, for example trialling Food to Go in Kensington and Regent Street for busy commuters. This year, we’ve got more exciting plans for our London customers, and Andrew will lead that work.'
Want to better understand Tesco's strategy?
To network with the Tesco commercial team and better understand the retailers food strategy, book your place at the 2013 Tesco Trade Briefing on 25 April, for details click here.