BRITISH shopping habits are changing and shoppers are increasingly shopping ‘little and often’ for c-store-sized basket loads. But that doesn’t mean they’re always visiting convenience outlets.
Speaking to the Confederation of British Industry conference after his first year as CEO of supermarket giant Tesco, Dave Lewis said basket sizes have reduced and the number of shopping trips have increased.
But he said Tesco, which has more than 2500 Tesco Expresses and One Stop franchised c-store sized outlets, still finds that 76% of convenience shopping carried out with the company takes place in its largest stores, such as Tesco Extra.
And, he said, while the convenience channel had recorded 5% growth for the year, more independent shops had closed in the first six months of 2015 than had opened in the same period.
Stressing what he sees as the positive contribution made to the economy and society by shops Lewis said 42% of 16- and 17-year-olds work in retail and suggested those teenage jobs provide “a valuable first experience of working life.”
Lewis went on to talk about deflation, reporting that while food price inflation had been running at 4% two years ago it had now fallen to -2.4%.
He accepted those falling prices might be great news for shoppers but said it put very significant pressure on parts of the retail industry.
The new Tesco chief told the conference that online retailing had grown to become a £10bn business but suggested further growth could present challenges to retailers of all sizes and for communities.
“Digital operations have no real community footprint, far fewer employees and a far lower tax contribution,” he said.
He said: “Over the last five years property values have fallen, profits are down but business rates are up.”
Saying the current level of rates is unsustainable he added: “I believe government needs to be careful and strategic on regulation and taxation.
“I would encourage the industry and government to consult on the multiple policy changes that are affecting the industry.
“The British Retail Consortium is already attempting to do this but it takes two to tango.”
