Long-time Tesco critic Bruno Monteyne claims market forces are conspiring against Tesco, which has long tried to be all things to all customers. Monteyne is arguing that Tesco’s fight to produce quality goods at affordable prices is a losing venture and is calling for the retailer to be broken into three divisions. One would target high-end groceries, another would focus on medium-priced outlets, and the third would take on discount giants such as Lidl and Aldi.
Monteyne, an analyst at Bernstein Research, thinks the incoming Tesco CEO should make the move immediately. “Splitting themselves into different channels allows them to use different strategies with different customers,” writes Monteyne. A former Tesco executive, he pointed out last year that Tesco had raised its prices by 4.6 percent per year between 2010 and 2013.
