Store format shake up for Tesco

8th January 2015

New large stores cancelled and some smaller neighbourhood stores to close as Tesco seeks to turn around poor performance

Tesco is to close some convenience branches

Beleaguered UK supermarket chain Tesco is moving against the sector trend to open further convenience stores, announcing that a number of its existing C-stores will close.

The retailer is to close 43 unprofitable stores – a significant proportion of which will be neighbourhood branches -  shelve plans for nearly 50 new large stores and relocate its head office in a bid to stem falling sales and profits.

Nearly 50 large new Tesco stores have been shelved

“We have some very difficult changes to make. I am very conscious that the consequences of these changes are significant for all stakeholders in our business but we are facing the reality of the situation. Our recent performance gives us confidence that when we pull together and put the customer first we can deliver the right results,” says Tesco chief executive Dave Lewis in a trading statement.

In a concerted effort to cut costs the company will not pay a dividend to investors in 2014/15, plans to close its staff pension scheme and introduce more flexible working hours and simpler store management structures.