Tesco launches new budget supermarket to rival Aldi and Lidl

Marco Green
September 22, 2018

The store was opened by Dave Lewis, Tesco's chief executive, with up to 15 more to be opened next year.

Tesco unveiled its first Jack's store - named after the United Kingdom supermarket chain's founder, Jack Cohen - in a small town 80 miles (129km) north of London.

The UK's largest retailer has struggled to compete in recent years as cheaper supermarket chains such as Lidl and Aldi have clawed away market share.

The store in Chatteris, Cambridgeshire, was unveiled on Wednesday and opened its doors to the public on Thursday alongside a second store in Immingham, north-east Lincolnshire.

A spokesman for Tesco said: "We have only confirmed two stores at the moment, and that's the only information I can give at the moment".

Tesco now offers over 25,000 products but Jack's will only offer 2,600 products including Jack's own brand items as well as big brands such as Coca Cola, Cadbury's and Lea & Perrins.

In addition to the Jacks brand, Jacks will stock some familiar grocery brands and a range of general merchandise on a “When its Gone, Its Gone” basis.

One shopper even told how she had queued for seven hours to be first into the new store, which is the first of about 15 to be opened nationally as Tesco takes on discounters Aldi and Lidl.

Tesco said eight out of 10 Jack's food and drink products will be "grown, reared or made" in Britain and stores will stock an own brand range, also branded Jack's.

Over the next six months Tesco will launch between ten and 15 Jack's stores in the United Kingdom, with a mix of entirely new sites, sites adjacent to existing Tesco stores, and a small number of converted Tesco stores.

Tesco now has a 27.4 percent share of Britain's grocery market, according to the latest industry data, although it could be overtaken by Sainsbury's proposed 7.3 billion pound takeover of Asda.

Analysts do, however, have concerns that Jack's could take sales from Tesco's existing stores - fears played down by Lewis.

The flag-waving also lets Tesco contrast its United Kingdom roots with the German ownership of Lidl and Aldi, at a time when Brexit has heightened some Britons' awareness of nationality.

Sainsbury's and Walmart-owned Asda, meanwhile, are trying to improve their fortunes with a planned merger.

We have been at the unveiling of the first Jack's near Cambridge.

Sainsbury's tried a similar tactic in 2014, opening a number of Netto stores which where subsequently closed two years later.

Tesco tried to go down the discount route in the 1980s, with its Victor Value brand.

In contrast, Aldi and Lidl had grown their respective market shares to 7.6% and 5.5% respectively.

Other reports by Click Lancashire

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