Report: Watchdog group claims Tesco stopped rivals from opening nearby stores
Photo courtesy of Tesco

The costs of COVID, new hires eat into Tesco’s sales profits over past year

Produce Business news report
Share on linkedin
LinkedIn
Share on twitter
Twitter
Share on facebook
Facebook
Share on whatsapp
WhatsApp
Share on email
Email

Tesco’s profits saw a sizable decline during the past year, tumbling by nearly 20% because of the massive costs of doing business during the COVID-19 pandemic, the company reported.

After posting more than £1 billion in pretax profit in the previous year, it brought in just £825 million in 2020-21. Those figures and the fact that the retailer had expenses of more than £890 million – largely related to having to add 50,000 colleagues, including many who have turned into full-timers –pushed in the retailer into negative territory.

Remember too that Tesco handed the UK government back nearly £600 million in tax relief because of robust sales as most consumers spent months cooking and ordering from home. It did, in fact, note a 7% boost in sales overall, buoyed by a huge upturn from its online business.

Despite the news and initial dip in shares of 2%, it was nothing but positives from Tesco’s leadership.

“Tesco has shown incredible strength and agility throughout the pandemic,” said Ken Murphy, Tesco CEO. “While the pandemic is not yet over, we’re well-placed to build on the momentum in our business.  We have strengthened our brand, increased customer satisfaction and improved value perception.  We have doubled the size of our online business and through Clubcard, we’re building a digital customer platform.”


Iceland sign on for MDS program

Retailer Iceland is joining other chains in working with the next generation of supermarket talent, combining with training firm Management Development Services (MDS) on a program to help advance students.

Iceland has seen rapid growth in its physical stores and especially online. Because of demand, the retailer must boost their number of workers to cover newly created roles.

“We are proud to have MDS alumni amongst our senior leadership team and have seen the success they have brought to the business,” Iceland HR Director Helen Tindle said. “We joined MDS as getting new talent into the food industry and retail is vital if we are to continue to grow our own future leaders. MDS is the perfect solution to remove cost and risk from the typical route into graduate recruitment schemes.”

Iceland, which has more than 900 stores, will be helping train new workers, who will receive placement in six-month secondments over two years, as well as off-the-job training, coaching and mentoring. Nearly 100% of all those in the program wind up finding jobs in fresh produce.

TAGS:

READ ON:




The Latest from PBUK

Subscribe to PBUK!

Get regular produce industry insights, sign up for our email newsletter below.