Tuesday, April 12, 2005

Fear of a Tesco Planet

Well today it was announced that Tesco has become the first British retailer to make over £2 billion profit. That means that 12.5% of all the money spent in retail outlets in the UK is spent at a branch of Tesco somewhere. For those of you who don't know, Tesco is a huge food retailer which has over the past few years branched out to sell absolutely anything and everything you could ever want, from flowers to internet access, from bread to savings accounts. I'll confess right now that I do my grocery shopping at Tesco, and I do tend to find that both the price and the quality are right. And yes, I do on ocassion succumb and buy movies, music or videogames there. So i'm just as guilty as everybody else. But you see, I remember a time when it wasn't like this...
Back in the 70s, when I was a kid, Tesco was just plain hideous. The stores were dingy and grimey, the staff were notoriously rude and unhelpful, the whole shopping experience was just plain hideous. Of course I didn't really know that at the time, all I knew was that the shop was nasty looking and I didn't want any food from there cos it didn't look nice. It wasn't just Tesco that was different either, the whole look of the high street was. There were grocers, and butchers, bakers and florists, tailors and just tons of all kinds of little speciality stores. Every town didn't look the same, cos the chains didn't exist in the same way we know them today, and doing the weekly shop involved trekking around to all the different types of stores to get what you needed. I remember during the school holidays when me and my little brother used to get dragged round everywhere, and we had to be good and endure the tedium of the whole shopping trip (although its clear to me now that my mum wasn't exactly having a ball either, but this was before the age when you realise that your parents are people and have emotions too). Hell there even used to be half day closing (everywhere shut at 1pm on Wednesday), there was no such thing as Sunday trading, and the very concept of being able to buy something after 5pm was literally ridiculous. It was a whole different world.
The supermarkets changed all that. They got big, they moved out of town, and they started to offer lots of quality products under one roof. The consumers foolishly went with them. We liked that we could do all our shopping in one place, it was convenient and it was even a little cheaper cos the supermarkets had economies of scale on their side. As the speciality stores were losing trade to the supermarkets, their prices had to rise a little to compensate. This of course led more people to the supermarkets, and the sprial began in earnest. Eventually almost all the specialist grocers and butchers and bakers had gone, and the only choice we had was which of the big supermarkets we'd patronise with our cash this week.
That was a pretty dark time for retailing, and for consumers too. We'd been complicit in removing the choice from our lives and for driving the specialists out of business, while the quality and variety of the supermarkets wasn't as poor as it used to be, there was little now motivation to improve because they'd already won.
In the past twenty years or so things have continued to change. Sure we've created at least one super brand in the form of Tesco, a company with a turnover greater than the GDP of a small European country, and that super brand is in and of itself a dangerous thing, but we've also seen the return of specialist stores to our high streets, and in response the supermarkets have upped the quality of their instore butchers, bakers and grocers. Tesco have pretty much got total control of food retailing in Britain, and have diversified into other areas too, using their scale to undercut specialist retailers all over again. Just like last time, they don't offer the range of product, they don't have the specialist knowledge of their product to advise you as a customer, in fact they have no knowledge of their product at all. They just pile it high and sell it cheap... I've not even touched on the way Tesco can use their immense buying power to bully suppliers into offering unrealistically low prices and the impact that has almost everything (as an example, take the farmers who have to sell their produce at less than cost, and how the European Union then has to prop up our farmers with grants as their businesses are no longer economical... think about that: food producers are not economically viable in the modern world).
I don't think this is a good thing at all. Its inevitable in a system which values profit above all else, and shy of some form of revolution (which is taking place, look for it in YOUR neighbourhood) I think its just the way things are going to be for a while. I'm just not looking forward to a Tesco (or Wal-Mart, or Nike, or Sony, or Microsoft or whatever) planet, thats all.

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