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Is this not a pointless comparison. Tesco hires an army of employees to pick products from the same shelves that the footfall is picking from whereas Ocado use an automated solution.
I’d imagine Tesco have been hit by large COVID costs as well.
)))) That made me chuckle Chilting! Good one, and yes very true!
The regional cfc’s Tesco are building next to extra stores will replace store pick for c. 50 stores each I believe.
The issue that Tesco are working through (as I understand it) is the design and fit out of those cfc’s and ai, more news to follow, I have no idea where they will contract that.
So Arkwright will pick off site in dedicated sheds in the yard! He just has to choose squigy humans or robots for the pick.
I hear the arguments on wage costs and increasing rates, the business case for revenue or capital will decide that I guess.
Let’s wait and see.
Poland by the way was a loss by the way but it’s now sold, so it’s revenue and losses will not show in 21/22, the cost of selling is in 20/21.
Tesco's operation is just a supped up version of what Arkwright offered in Open All Hours - remember Granville's shop bike.
https://www.youtube.com/watch?v=0EJIQ4UIS_c
When shopping in Tesco I watch the stockpickers with the large trolleys and boxes being hampered by customers and vice versa and I think that is no way run a modern service. Ten years ago maybe.
Last August Tesco announced it was hiring 16000 extra staff just to cover online sales. This figure included 10,000 extra staff just to pick customers orders off the shelves in store and warehouses and our local Tesco is still after more part time minimum wage staff to do the same. It can work in the short term, but all this extra cost has to be a major drag on profits as it is so inefficient.
Tesco's 77% increase in UK online sales and doubling of online grocery slot deliveries in the UK bodes very well for Ocado. The more consumers shift to grocery online the greater the appeal around the world of Ocado's market leading online delivery solutions. Higher sales translate into higher demand and higher profits for Ocado as more CFCs open.
Neil, Again you use condescending remarks.
"175m bank loss, Bank loss because it closed current accounts." Retail operating profit declined 14.7%. Tesco Bank figures are not included in this profit drop.
"Central Europe was the profit loss." Central Europe contributed operating profit of £124m.
"Online made money." - That is your opinion, there is no proof of that in the results release. Tesco do not split out their online profits from the rest of their retail sales
Online expansion has been a big drag on profitability at Tesco.
Ok, their online made money, but the crucial point is that it is expensive to operate because it is so labour intensive - it totally overturns the notion of stacking it high and selling it cheap.
These additional costs are a drag on profits.
I am quite sure that if Tesco's senior management had the option of ceasing their online sales that they would do so in a flash, but that's not what the market wants - they are stuck with what they have got and its very inefficient compared to Ocado. Also Aldi and Lidl are just in the market to stack it high and sell it cheap with a bit of click and collect thrown in.
Nice 53p divi tho earlier in year from Tesco sale of Asia tho.
I agree there are better places to invest than supermarkets tho. Except where SP dropped last March-but that was a one off.
Later this year tho supermarkets will become an interest.
TSCO has been (and probably will remain ) a value trap for 20 years .... to invest in TSCO/SBRY/MRW has been a big mistake .
Pity you don’t read before engaging your finger.
Wrong.
175m bank loss, Central Europe was the profit loss.
Bank loss because it closed current accounts.
Online made money.
The 28% drop in profits is the crucial number. It's driving the share drop today. Online expansion has been a big drag on profitability.
https://www.chargedretail.co.uk/2021/04/13/online-grocery-is-now-as-profitable-as-instore-shopping-for-the-first-time/
Breakpoint passed.
The +77% online is the critical number, and it’s in profit.
Tesco ambition I guess is to make cash work harder having learnt lessons in Central Europe and Asia. I see 3 things, 1, Merger with a giant global retailer to get improved buy terms ( cogs) 2, Domestic acquisition into diverse retail. 3, CFC’s development in highest densities.
No chance Allatsea, they don't seem to have any new ideas. Although if you want an investment that doesn't lose much, they are good.
Ocado sp slowly gaining ground (I hope)
A recent article (Motley Fool?) said Tesco was set fair to be the world's next Amazon. What world is that, I wondered.
Tesco's results are out today.
The company reports a healthy increase in sales of around 9% in the UK and they have basically doubled the number of delivery slots offered and recorded a 77% increase in online sales but there is a price to pay, profits in the UK have fallen by around 15%, despite the increase in sales.
So despite running an efficient home delivery operation, when it involves hand picking from the store, there is a big price to pay regarding profit. Its simply too labour intensive.