Tesco in Asia reports a 54.1% growth in profit to GBP171m.
Positive sales in Asia
Sales in Asia grew strongly, 8.4% year on year, to GBP2.56 bn, although the growth was registered as 1% on constant exchange rate. Like-for-like sales fell by 1.3% due to the reduced sales of general merchandise. Price investment in fresh food products and own brand expertise drove sales growth in Malaysia. In Thailand, improvements in distribution efficiency and more focused marketing activities helped to reduce cost, giving a significant boost to overall profit.
New customer propositions
The retailer had been focusing on differentiating their customer proposition for both large and small stores in Thailand. It opened the first urban supermarket in June. Re-invented large stores generated a sales uplift of 4.8% in the trial period, giving confidence that it was a move in the right direction.
Tesco Express stores proved successful
The trial Express stores with the new proposition had also been well received in the last few months. Dave Lewis, CEO of Tesco, said, “we plan to roll out the enhanced offer to all Express stores. We have introduced 300 products in smaller pack sizes, added 100 products to our ‘ready to eat’ range and extended our ‘food to go’ drinks offer, in addition to maintaining our focus on fresh evening meal solutions.”
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