Tesco set for global expansion of £30billion by 2012

Turnover of UK retailer, Tesco, will increase by £30bn to almost £74bn within five years and store numbers will double, as rapid overseas expansion, particularly in the United States and Asia, fuels growth, according to new research by international food and grocery experts at IGD.

“By 2012 a third of Tesco’s revenue, and two thirds of its floor space, will be outside the UK. 250 Fresh & Easy stores will have opened in the USA by 2009, and there will be many smaller formats stores across Asia, where hypermarkets account for three quarters of Tesco’s current turnover,” says Ben Miller, author of Trading With Tesco and international programme manager at IGD.

“Overall, Tesco’s international business will treble in size to £24bn. Suppliers who respond to Tesco’s demanding and purposeful approach; demonstrate clear customer focus in all proposals and communication; and maintain a transparent dialogue with Tesco are most likely to reap rewards,” says Miller.

The report predicts that Tesco’s commitment to Corporate Social Responsibility (CSR) is also a significant opportunity for suppliers.

“Tesco has put environmental responsibility at the epicentre of their corporate strategy and has set environmental and social targets on packaging, climate change and ethical trading. Suppliers who can help Tesco deliver on these targets are going to be well-placed to profit,” concludes Miller.

IGD also predicts that by 2012:
·Tesco will have a portfolio of 6,628 stores - double the current figure of 3,262.
·It will have increasing presence in Central Europe, the United States and Asia where it will open more Express stores in Japan, and the first mini Expresses in China by 2009.
·Tesco’s operations in the UK and Republic of Ireland will account for 67% of sales compared to 79% now.
·Tesco will enter India’s £117 billion food and grocery market but not in the immediate future.