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Tesco shares...
Comments
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Ten years ago Tesco shares were about the same price as they are now. But the PE ratio has dropped from 20 to 10, so the bad news is in the price.
A number of reasons have been put forward for the declining sales.
But all of these reasons have been around for many years - like Waitrose, Aldi & Lidl, and they had little effect on Tesco before.
And it can't be a Tesco specific problem because all the big 4 are losing sales.
So what has actually changed?
The biggest change has been the increasing gap between rich and poor.
Middle of the Road retailers like Tesco, are losing customers at both ends.
Rich Customers moving to Waitrose / M&S food.
Poor customers moving to Aldi / Lidl.“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair0 -
I don't think Amazon poses much risk at present to the online grocers. Given Amazon's difficulty turning a profit as it is, a full fledged entry into groceries in the UK seems unlikely. Amazon has yet to roll their AmazonFresh service out widely in the United States, let alone the UK. It seems to me doomed to be an unprofitable endeavour for Amazon.great post Scarpacci. i think you have it spot on. and, for me, the last point is the key...whether to hold any of them at all. online, are amazon going to move further into food and beat them? or do Tesco have the mix to further strengthen?
Amazon would face many of the same problems Ocado has in making grocery deliveries profitable from distant warehouses. It would require huge expenditure on refrigerated warehouses and refrigerated vans, and would still leave them delivering groceries a considerable distance away from most of their customers. The supermarkets have a great advantage in having locations close to the customers. I don't think the warehouse hub method for groceries could ever be as profitable or efficient as the supermarkets' way. Unless Amazon find a way to revolutionise grocery deliver (refrigerated drones?
), I don't see them coming for the big supermarkets. They will probably stick to selling bulk, unrefrigerated items. This is everybody's fault but mine.0 -
From a consumers point of view as opposed to an investors I think that Clarke summed things up the other day when he say he listens, he is not listening to customers, people are fed up with the food scandals, cut backs in staff, dirty stores and misleading offers. Remember they are losing market share despite their continued expansion. Communities are now standing up to them, we have 8 in 5 miles.
I know of at least 8 of my fiends who were loyal customers who have deserted TESCO for the opposition, one only last week, 2 trolleys of shopping told to use the self service or wait 30 minutes for a member of staff to open a till needless to say they parked up the trolleys and walked out.
Good luck with your investments0 -
one only last week, 2 trolleys of shopping told to use the self service or wait 30 minutes for a member of staff to open a till needless to say they parked up the trolleys and walked out.
Our nearest Aldi suffers the same fate. Too few checkouts open. Aldi is becoming too successful for its own good. So don't write Tesco's off. Still is a dominant player in the market.0 -
From a consumers point of view as opposed to an investors I think that Clarke summed things up the other day when he say he listens, he is not listening to customers, people are fed up with the food scandals, cut backs in staff, dirty stores and misleading offers. Remember they are losing market share despite their continued expansion. Communities are now standing up to them, we have 8 in 5 miles.
I know of at least 8 of my fiends who were loyal customers who have deserted TESCO for the opposition, one only last week, 2 trolleys of shopping told to use the self service or wait 30 minutes for a member of staff to open a till needless to say they parked up the trolleys and walked out.
Good luck with your investments
It's bit of a myth to cite Lidl & Aldi as being cheaper than the bigger players because in reality they aren't that cheap. Some items are cheaper and others are more expensive than they are at Tesco. I use them all, Tesco included, and cherry pick special offers when they're things I want and usually would buy.
That's the real way to keep your shopping bill in check.0 -
Glen_Clark wrote: »Ten years ago Tesco shares were about the same price as they are now. But the PE ratio has dropped from 20 to 10, so the bad news is in the price.
A number of reasons have been put forward for the declining sales.
But all of these reasons have been around for many years - like Waitrose, Aldi & Lidl, and they had little effect on Tesco before.
And it can't be a Tesco specific problem because all the big 4 are losing sales.
So what has actually changed?
The biggest change has been the increasing gap between rich and poor.
Middle of the Road retailers like Tesco, are losing customers at both ends.
Rich Customers moving to Waitrose / M&S food.
Poor customers moving to Aldi / Lidl.
Nothing to do with being poor. Value for money. Why pay more than you have to for an identical product?0 -
From a consumers point of view as opposed to an investors I think that Clarke summed things up the other day when he say he listens, he is not listening to customers, people are fed up with the food scandals, cut backs in staff, dirty stores and misleading offers. Remember they are losing market share despite their continued expansion. Communities are now standing up to them, we have 8 in 5 miles.
I know of at least 8 of my fiends who were loyal customers who have deserted TESCO for the opposition, one only last week, 2 trolleys of shopping told to use the self service or wait 30 minutes for a member of staff to open a till needless to say they parked up the trolleys and walked out.
Good luck with your investments
But food scandals are not a Tesco specific problem. As I recall the highest percentage of horsemeat was found in Aldi beefburgers.
As for 30 minutes please don't exaggerate.“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair0 -
Why do people shop at M&S when they can get similar stuff at Primark for half the price?Thrugelmir wrote: »Nothing to do with being poor. Value for money. Why pay more than you have to for an identical product?
Tesco have a far bigger range than Aldi, so even where they were more expensive, busy people would go there to get everything in one trip.“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair0 -
Glen_Clark wrote: »Why do people shop at M&S when they can get similar stuff at Primark for half the price?
Tesco have a far bigger range than Aldi, so even where they were more expensive, busy people would go there to get everything in one trip.
M&S has been losing market share in clothing for many years.
Busy people use online ordering and Tesco home delivery. An area which is showing growth.
Tesco is losing market share in basic lines. Fruit and veg, bread, milk etc. All are cheaper in Aldi.
The "discounters" are very clever. Sell bulk lines that turnover. No need to offer 25 different brands of the same product line. Price is preferable to choice for many people.0 -
But people still buy stuff they could get for half the price in PrimarkThrugelmir wrote: »M&S has been losing market share in clothing for many years.
Its showing growth in turnover. But what about profit?Thrugelmir wrote: »Busy people use online ordering and Tesco home delivery. An area which is showing growth.
Wrong. Tesco sell 4 pints of milk for £1, a wholemeal loaf for 45p. Aldi is NOT cheaper on that, or the fruit and veg I have compared. Both sell bananas for 68p kiloThrugelmir wrote: »Tesco is losing market share in basic lines. Fruit and veg, bread, milk etc. All are cheaper in Aldi.“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair0
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