Tesco say price-cutting will continue

Tesco cart.jpgQ3 comments from Tesco, the world’s 3rd largest retailer, confirm the picture of a more frugal consumer suggested by other majors.

On the positive side, they report “a material improvement” in sales “in both Asia and Europe“. And Tesco expect “this trend to continue into Q4 and beyond”.

But on the less positive side, CFO Laurie McIlwee said competition was intense in the run-up to Xmas, with promotional activity at an ‘unprecedented level'”. Consumers seem increasingly focused on cut-price offers, and even then they seem to be cautious in their spending.

Chemical companies supplying directly into the retail sector have been feeling this pain for some months. It has become very difficult to pass on higher oil prices, particularly with Retail Price Indices now in negative territory in many countries.

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. He also serves as a Global Expert for the World Economic Forum. The aim of this blog is to share ideas about the influences that may shape the chemical industry and the global economy over the next 12 – 18 months. It looks behind today’s headlines, to understand what may happen next in critical areas such as oil prices, China and Emerging Markets, currencies, autos, housing, economic growth and the environment. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.

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