Tesco sees improved consumer confidence
Supermarket giant has today reported that overall sales rose by 8.8% (including petrol) over the last three months. Excluding petrol, sales were up 7.7%.
Tesco, which has a 30% share of the UK’s grocery market, said sales are up as a result of its double points Clubcard promotion and heavy discounting.
The retail said that the Clubcard was “growing in importance as a reason why customers switch to shopping at Tesco”.
The group added that it had experienced “particularly strong growth” in non-food items such as toys and electrical goods in the build-up to the Christmas period.
Chief executive Terry Leahy said: “We’ve continued to make good progress this quarter with contributions to growth from across the business.
“We are seeing improving customer confidence and encouraging trends in both the UK and our international business, although recessionary conditions still exist in a number of markets,” he added.
The group has recently cut the price of its luxury “Finest” food range in a bid to compete with upmarket chains such as Marks and Spencer and Waitrose.
Meanwhile, international sales were up by 12%, fuelled by 18.9% growth in Asia. It also said European markets were showing signs of recovery.
In related news, Tesco is in the midst of its expansion plan into financial services.
The retailer plans to compete with High Street banks and hopes to take advantage of the lack of confidence in existing banks by attracting disillusioned customers.
It has also said it plans to offer mortgages in the near future, and is planning to build a telecoms business generating £2 billion a year of sales.