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Morning Briefing for pub, restaurant and food wervice operators

Mon 29th Jul 2013 - Tesco - food courts important part of our plans
Tesco – food courts an important part of our plans: Tesco’s larger sites on the outskirts of towns will be turned into “retail destinations that are exciting, relevant and convenient”, new UK managing director Chris Bush has told The Grocer magazine. Bush said the company wants to create destinations that would means shoppers can visit a yoga class, pop into the dry cleaner’s, get their hair or nails done, or enjoy a meal - all in the same retail space. Bush said food courts were an “important part” of the company’s plans, with fresh food, coffee shops, and fast food options part of the offer. Tesco opens a Giraffe at its Watford store on 5 August – with plans to open ten in total this year - and a new carvery-style concept the same day in Coventry. Bush formerly ran Tesco Thailand and the company’s plans are influenced by the Tesco Lotus Plus Shopping mall at Srinakarin, just outside Bangkok. “Providing a space for the community is an important part of the destination offer there,” Bush told The Grocer. UK out-of-town hypermarkets are changing because retail was becoming “more personalised and anticipatory”, he said. Bush added: “In the past, large hypermarkets were popular because they offered a massive range of products and people liked being able to buy everything under one roof – it made life easier. The internet has changed all that - people don’t even need to leave their homes to go shopping and more people are using convenience stores for regular top-up shops. Our customers pay to put fuel into their car and drive away from their homes to visit us, so we need to give them good reasons to come to our larger stores.” Tesco’s new approach to hypermarkets was because two different retail models emerging, Bush argued. Tesco is planning for the evolution of both with a convenience format and larger shops becoming retail destinations. He told The Grocer: “Stores will be convenient, because we know how busy our customers are. They might want to pop in and do a quick top up shop or grab something quickly for dinner. They also want to access services that are available under one roof. However, if customers want to touch and feel what they’re buying, spend some time with friends and family over a coffee or pop to the gym after work, then they can do this too. So you will see larger shops turn into retail destinations. In our stores, you’ll see food areas, restaurants, coffee shops, places to have your nails done or browse for clothes.” Earlier this year, Tesco commercial director Kevin Grace wrote: “We’ve been doing a lot of thinking about retail destinations and how our stores might become somewhere that people spend more time, as well as shop. With more general merchandise moving online, we have a great opportunity to rethink how we use the space in some of our larger stores. To put some of that thinking into context, it might be useful to think about the many different shopping malls around the world. In most cases, their food concepts are excellent and it’s one of the main reasons people go there. Let’s look at two examples. Lots of our larger stores in Asia have restaurants regularly used by customers to meet their friends and spend time together; people like being able to take a break and relax after their shopping trip. Similarly, if you’ve ever visited Westfield, you’ll know that people go there to meet, eat and drink as much as they do to shop. They have a fantastic collection of restaurants - around 50 different concepts serving fresh, quality food and a variety of cuisines. The brands are accessible yet aspirational and the comfortable dining space allows customers to relax, socialise, recharge. It’s not an afterthought – it’s central to their offer. There’s no reason that supermarkets can’t offer something similar here.”

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