£1bn 'Building a better Tesco' plans revealed - including 20,000 new jobs and the launch of online 'click & collect' service
Supermarket chain Tesco has announced its new business strategy, which includes the recruitment of 20,000 new jobs and a commitment of £1bn to improve the shopping experience for its customers, as it announces its trading figures for last year.
Amongst its figures, the supermarket chain saw a rise in sales of 7.4%, up to £72bn, with a statutory pre-tax profit of £3.8bn, (+5.3%) and an underlying pre-tax profit of £3.9bn (+1.6%).
The company has also announced that it plans to decrease group capital expenditure from £3.8bn during 2011/2011 to £3.3bn during 2012/2013, as well as its plans to spend £1bn this year on improving customer’s shopping experience.
This strategy will focus on improvements to service and staff, with up to 20,000 new members being recruited and 8,000 receiving new training within existing stores over the coming two years.
Other factors of the ‘Build a Better Tesco’ plan include the creation of a faster store refresh programme, the introduction of better promotions and prices, with ‘more personalised’ offers, a better ranger offering, including the relaunch of Tesco brands, ‘better, clearer, more relevant’ communications with customers and a ‘Click & Collect’ roll out, as it aims to improve its online service.
Announcing the financial results and the new strategy, Philip Clarke, chief executive of Tesco, commented; "The last few months have seen us drive a faster pace of change in Tesco, particularly in the UK, reflecting our determined focus on the immediate objectives for the Group that were set out last April. This pace of change will accelerate further over the next twelve months. We have already taken important steps to renew and strengthen management in the UK and across the Group in key areas, to support this programme of change.
"Whilst our International business is delivering excellent growth, contributing £1.1 billion of profit to the Group, we fully recognise that we need to raise our game in the UK. As a result, we are committing over £1 billion to make the UK shopping trip better for customers: more staff giving improved service in-store; refreshed stores that are better and easier places to shop; lower prices and even more value from an improved product range. As we improve the shopping trip for our customers, it will follow that our sales growth and financial performance will improve too.
"These are decisive steps and this cost investment - as we have already announced - will constrain our near-term profitability. We are also focusing our lower overall capital expenditure more into our existing stores and in building our online businesses. We are adapting our UK capital plans so that we have the right store base for the future, to underpin the returns that create long term value for our shareholders. Together these steps are the right things to do both to improve the shopping trip for customers and to secure a return to profitable growth in the UK."