Under Leahy that race was won emphatically by Tesco as it added small convenience stores and huge department-store-style Extras.īut the 2015 loss reflected a towering £7bn of one-off costs, including £4.7bn relating to a revaluation of its store estate.ĭespite Lewis’s overhaul, Tesco’s UK market share continues to drift downwards as the German discounters continue their rapacious expansion. In the 1990s and 2000s, the big supermarket chains had been engaged in a “space race” – competing to see who could open the most stores. Lewis’s first set of annual results in 2015 was indeed a horror show: the company crashed to a £6.4bn loss, he axed thousands of head-office jobs – including the retailer’s famously austere Cheshunt headquarters in Hertfordshire – and closed more than 40 loss-making stores. Tesco could have gone under.”Īnalysts say there was a serious risk that Tesco might have disappeared from the high street during the nadir of 2014. There was no credible chairman or non-executives, and colleagues were about to be prosecuted by the Serious Fraud Office.
“People forget what a shitshow it was when he arrived. “In terms of what Dave Lewis came into, it is mission accomplished,” said Black.
The City was caught off guard by Lewis’s desire to walk away next year, but Shore Capital analyst Clive Black said he deserves to be celebrated as the “bloke that saved Tesco”. “I think if you’re in our business and you’re not spending all of your time looking at the quality and the presentation and the taste of the food and the products you serve – what are you doing?” Lewis said at the time. More importantly, it focused minds on how Tesco’s prices and products compared with those of rivals such as Aldi and Lidl. He used it to force his top managers – many of whom were used to crisscrossing the globe on the company’s now long-gone corporate jets – to confront the day-to-day reality of food shopping like an ordinary customer. The 2014 executive trip to Norfolk is an example of Lewis’s back-to-basics approach. There was no credible chairman or non-executives and colleagues were about to be prosecuted Clive Black, analyst, on the situation when Lewis joinedĮxpressing a desire to travel to Bhutan and spend more time with his family, Lewis said the job had been “all consuming” and it was time to “pass the baton” to a new leader – in this case Ken Murphy, an Irish businessman who has spent much of his career working for health and beauty retailer Boots. The Tesco brand “is stronger and customer satisfaction is the highest it has been for many years”, he said. The former Unilever executive has also tackled its reputation for aggressive dealings with suppliers, and agreed to pay a £129m fine over the accounting scandal. Profits are rising, the £22bn debt pile he inherited has almost halved and £1.6bn of costs have been carved out of the retailer. He has described his time at Tesco as ‘all-consuming’.
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