Tesco PLC stands as one of the world’s leading multinational grocery retailers, a powerhouse in the retail industry with a presence that spans multiple countries and a business model that integrates a wide array of services. From its humble beginnings over a century ago to its current status as a household name, Tesco has consistently evolved to meet the needs of its customers while adapting to changing market dynamics.
Company Profile
Tesco PLC is far more than just a grocery store chain—it’s a multifaceted organization that plays a pivotal role in the lives of millions of people across the globe. At its heart, Tesco is driven by a clear and compelling purpose: “Serving our customers, communities, and planet a little better every day.” This mission is not just a tagline but a guiding principle that shapes the company’s strategies, operations, and interactions with stakeholders.
Tesco operates in multiple markets, including the United Kingdom, Republic of Ireland, Slovakia, the Czech Republic, and Hungary, serving millions of customers each week through an extensive network of physical stores and a robust online platform. The company’s retail operations are diverse, catering to various customer needs through different store formats:
- Large Stores: Often referred to as superstores or hypermarkets, these locations offer an expansive range of products, including groceries, clothing, electronics, and household goods. They are designed to be comprehensive shopping destinations where customers can find everything they need under one roof.
- Convenience Stores: These smaller outlets are strategically placed in urban and suburban areas, providing quick and easy access to essential items for customers on the go. They cater to those seeking convenience without the need for a full grocery shop.
- Online Platforms: Tesco has embraced the digital age with a sophisticated e-commerce system. Through its website and mobile app, customers can order groceries for home delivery or opt for click-and-collect services, a testament to the company’s adaptability in a world increasingly reliant on online shopping.
Beyond its core retail business, Tesco extends its influence through a family of businesses that diversify its offerings and enhance its value proposition:
- Booker: As the UK’s leading food and drink wholesaler, Booker serves caterers, independent retailers, and other businesses, broadening Tesco’s reach beyond traditional retail.
- dunnhumby: A global leader in customer data science, dunnhumby provides technology, software, and consultancy services that help retailers and brands—including Tesco itself—understand consumer behavior and strengthen customer loyalty.
- One Stop: A retail convenience business with over 1,000 shops across the UK, including more than 300 franchise stores, One Stop complements Tesco’s larger retail formats by serving local communities.
- Tesco Bank: This arm of the company offers a range of personal banking and insurance products, such as loans, credit cards, and insurance policies, often integrated with Tesco’s loyalty program to provide additional benefits.
- Tesco Mobile: A joint venture with O2, Tesco Mobile is an award-winning mobile operator serving over five million customers in the UK, offering competitive plans and exceptional service.
Tesco’s commitment to affordability, health, and sustainability is evident in its focus on providing high-quality food and services that meet modern consumer demands. Whether it’s through its physical stores, online channels, or additional businesses, Tesco strives to deliver value and convenience, making it a trusted name in the retail landscape.
Company History
Tesco’s story is one of ambition, innovation, and resilience, tracing its roots back to 1919 when Jack Cohen, a young entrepreneur, began selling surplus groceries from a stall in London’s East End. Cohen’s entrepreneurial spirit laid the foundation for what would become one of the world’s largest retailers. The name “Tesco” emerged in 1924, a creative blend of the initials of tea supplier T.E. Stockwell and the first two letters of Cohen’s surname. This marked the birth of a brand that would go on to redefine grocery retailing.
The company’s early years were marked by steady growth. In 1929, Cohen opened the first Tesco store, a modest beginning that set the stage for expansion. By 1947, Tesco became a public company, listing on the London Stock Exchange and gaining access to capital that fueled further growth. The 1950s brought a significant milestone when Tesco pioneered the self-service supermarket model in the UK. This innovative approach allowed customers to browse and select products independently, a departure from the traditional counter-service model, and it quickly gained popularity.
Throughout the latter half of the 20th century, Tesco’s growth accelerated. The 1970s and 1980s saw the company expand its store network and diversify its product offerings, introducing non-food items like clothing and electronics. By the 1990s, Tesco had solidified its position as the UK’s largest supermarket chain, a status achieved through both organic growth and strategic acquisitions of rival chains.
The late 1990s and early 2000s marked Tesco’s ambitious foray into international markets. The company entered Central Europe, Asia, and even the United States, aiming to replicate its UK success on a global scale. While some ventures, such as its operations in Central Europe, thrived, others, like the Fresh & Easy experiment in the US, faced challenges and were eventually discontinued. These experiences shaped Tesco’s current strategy, which focuses on strengthening its core markets rather than pursuing widespread global expansion.
Today, Tesco stands as a retail titan, with a legacy of innovation that includes the introduction of loyalty programs, online shopping, and a diverse range of store formats. Its ability to adapt to changing consumer preferences and economic conditions has ensured its enduring success over more than a century.
Products and Services
Tesco’s product and service portfolio is vast and varied, designed to meet the needs of a broad customer base while maintaining a focus on quality, affordability, and convenience. The company’s offerings can be categorized into its core retail operations and the additional services provided through its family of businesses.
Retail Operations
- Groceries: Tesco’s primary business revolves around grocery retailing, offering a wide selection of fresh produce, packaged foods, beverages, and household essentials. From fruits and vegetables to pantry staples, Tesco ensures a comprehensive range that caters to diverse dietary preferences.
- Non-Food Items: Beyond groceries, Tesco stocks clothing, electronics, homeware, and seasonal products, making it a one-stop shop for many households. Its clothing brand, F&F, is particularly popular for offering affordable yet stylish options.
- Specialty Departments: In its larger stores, Tesco features specialized sections such as bakeries, delis, and pharmacies, enhancing the shopping experience with fresh, on-site prepared goods and health services.
Tesco operates multiple store formats to serve different customer segments:
- Large Stores: These superstores provide an extensive product range, ideal for weekly shopping trips.
- Convenience Stores: Smaller outlets offer quick access to essentials, perfect for busy customers.
- Online: Tesco’s e-commerce platform allows customers to shop from home, with delivery or collection options available.
Additional Services
Tesco’s family of businesses extends its reach beyond traditional retail:
- Booker: As the UK’s leading food and drink wholesaler, Booker supplies caterers, independent retailers, and businesses with a wide range of products at competitive prices. This service strengthens Tesco’s position in the wholesale market.
- dunnhumby: A global leader in customer data science, dunnhumby analyzes consumer data to provide insights that enhance customer experiences and drive loyalty. Its services benefit Tesco’s retail operations and are also offered to external clients.
- One Stop: With over 1,000 convenience stores, One Stop serves local communities with a curated selection of products, including groceries and everyday essentials.
- Tesco Bank: This financial services arm offers personal banking and insurance products, including loans, credit cards, and insurance policies. Integration with Tesco’s Clubcard program adds value for customers.
- Tesco Mobile: A joint venture with O2, Tesco Mobile provides mobile plans and services to over five million UK customers, known for its affordability and award-winning network.
Tesco’s commitment to affordability is reflected in its pricing strategies, such as the Aldi Price Match program and the Clubcard loyalty scheme, which offer customers competitive prices and rewards. Together, these products and services position Tesco as a versatile and customer-centric organization.
Brand Details
Tesco’s brand is a cornerstone of its success, built on a foundation of trust, value, and innovation. The company has cultivated a strong identity that resonates with customers across its markets, emphasizing affordability, quality, and sustainability.
Key Brand Initiatives
- Aldi Price Match: Tesco matches the prices of hundreds of products to those at discount retailer Aldi, ensuring customers get the best value without compromising on quality.
- Clubcard Prices: Tesco’s loyalty program offers exclusive discounts and rewards to members, encouraging repeat purchases and fostering customer loyalty. In 2024, this program was expanded to include personal loans through Tesco Bank, integrating financial services into the loyalty ecosystem.
- Low Everyday Prices: A commitment to keeping prices low on essential items helps customers manage their budgets, reinforcing Tesco’s position as a cost-effective shopping destination.
- Price Drop Campaign: Launched in 2024, this campaign reduced prices on everyday essentials, solidifying Tesco’s reputation as the UK’s cheapest full-line grocer.
Brand Values
- Value Proposition: Tesco prioritizes delivering value through competitive pricing and high-quality products, ensuring accessibility for all customers.
- Sustainability: The company is dedicated to reducing its environmental footprint, with initiatives focused on sustainable sourcing, reducing carbon emissions, and promoting healthier food options.
- Community Engagement: Tesco supports local communities through food donation programs, charity partnerships, and initiatives that address social issues.
Tesco’s brand strength is evident in its high Clubcard sales penetration rates, a key indicator of customer engagement and loyalty. By consistently evolving its brand to meet modern demands—whether through digital innovation or sustainability efforts—Tesco remains a trusted and relevant name in retail.
Board of Directors
Tesco’s Board of Directors comprises a diverse group of leaders who bring a wealth of experience to guide the company’s strategy and governance. As of 2024, the board includes both executive and non-executive directors, each contributing unique expertise.
Current Board Members
- Gerry Murphy (Chair)
Appointed in September 2023, Gerry Murphy serves as the Chair of Tesco’s board. With a distinguished career in leadership roles across consumer goods, healthcare, and other sectors, he brings a strategic perspective to the company’s oversight. His appointment reflects Tesco’s focus on strong governance and long-term planning. - Ken Murphy (Group Chief Executive)
As the Group Chief Executive, Ken Murphy is responsible for Tesco’s overall management and strategic direction. With extensive experience in retail and consumer products, he has been instrumental in driving the company’s growth and innovation initiatives. - Imran Nawaz (Chief Financial Officer)
Imran Nawaz oversees Tesco’s financial operations and strategy. His background in finance and strategic planning ensures robust financial management, supporting the company’s investment and expansion goals. - Stewart Gilliland (Non-executive Director)
Stewart Gilliland chairs the Sustainability Committee, leveraging his experience in the food and drink industry to guide Tesco’s environmental and social responsibility efforts. His role is critical in aligning the company with sustainability trends. - Byron Grote (Non-executive Director)
Serving as the Senior Independent Director, Byron Grote brings expertise in finance and energy. His insights help ensure effective governance and strategic decision-making. - Carolyn Fairbairn (Non-executive Director)
Carolyn Fairbairn contributes knowledge in macroeconomics, regulation, and media. Her appointment in 2023 reflects Tesco’s emphasis on navigating complex economic environments. - Karen Whitworth (Non-executive Director)
As Chair of the Audit Committee, Karen Whitworth ensures financial integrity and risk management. Her background in finance makes her a key player in maintaining Tesco’s fiscal discipline.
The board’s diverse skill set—from retail and finance to sustainability and regulation—enables Tesco to address challenges and seize opportunities in a competitive market. Each director plays a vital role in representing shareholder interests and steering the company toward continued success.
Subsidiary and Associate Details
Tesco’s operations are bolstered by a network of subsidiaries and associates, each contributing to the group’s overall performance and strategic objectives. These entities enhance Tesco’s diversification and market presence.
Subsidiaries and Associates
- Booker Group (100% owned)
Booker is the UK’s leading food and drink wholesaler, acquired by Tesco in 2018. It serves caterers, independent retailers, and businesses, providing a wide range of products and strengthening Tesco’s supply chain capabilities. - dunnhumby (100% owned)
A global leader in customer data science, dunnhumby offers technology and consultancy services that analyze consumer behavior. Its insights benefit Tesco’s retail operations and are also sold to external clients, adding a revenue stream. - One Stop (100% owned)
One Stop operates over 1,000 convenience stores across the UK, including more than 300 franchise locations. It complements Tesco’s larger stores by serving local communities with accessible retail options. - Tesco Bank (100% owned)
Tesco Bank provides personal banking and insurance products, such as loans, credit cards, and insurance. Its integration with the Clubcard program enhances customer retention and diversifies Tesco’s income. - Tesco Mobile (50% owned)
A joint venture with O2, Tesco Mobile serves over five million UK customers. This award-winning mobile operator offers competitive plans and leverages Tesco’s brand to drive growth in the telecommunications sector.
These subsidiaries and associates not only generate revenue but also provide strategic advantages, such as data insights, customer loyalty, and market expansion. Tesco’s full ownership of most entities ensures tight integration with its core retail business, while the joint venture structure of Tesco Mobile balances risk and reward.
Geographical Details and Revenue Breakup
Tesco operates across multiple geographies, with a strong focus on Europe. Its store network reflects its strategic concentration on key markets:
Store Counts by Region
- United Kingdom: 3,786 stores
- Republic of Ireland: 170 stores
- Czech Republic: 184 stores
- Slovakia: 169 stores
- Hungary: 197 stores
The UK is Tesco’s largest market, accounting for the vast majority of its sales and operations. While exact revenue percentages are not publicly detailed, the UK dominates the group’s financial performance, followed by smaller but significant contributions from Central Europe (Czech Republic, Slovakia, and Hungary) and the Republic of Ireland.
Tesco’s geographical strategy prioritizes markets where it has a strong competitive position and deep customer understanding. This focused approach allows the company to optimize its resources and maintain profitability across its regions.
Financial Statements
Tesco’s financial performance in 2024 underscores its resilience and ability to deliver value. Below are the consolidated financial statements for the year ended 24 February 2024, presented in clear tables.
Consolidated Income Statement
| Item | 2024 (£m) | 2023 (£m) |
|---|---|---|
| Group sales | 68,187 | 65,322 |
| Operating profit | 2,821 | 2,630 |
| Profit before tax | 2,289 | 1,000 |
| Profit for the year | 1,768 | 737 |
Group sales grew by 7.4% to £68.2 billion, driven by strong customer demand. Operating profit increased by 11.6% to £2.8 billion, reflecting improved efficiency, while profit before tax more than doubled to £2.3 billion, boosted by operational gains.
Consolidated Balance Sheet
| Item | 2024 (£m) | 2023 (£m) |
|---|---|---|
| Non-current assets | 32,722 | 33,564 |
| Current assets | 13,431 | 12,180 |
| Total assets | 46,153 | 45,744 |
| Current liabilities | (14,133) | (14,134) |
| Non-current liabilities | (15,219) | (15,647) |
| Total liabilities | (29,352) | (29,781) |
| Net assets | 16,801 | 15,963 |
Total assets reached £46.2 billion, with net assets rising to £16.8 billion, indicating a solid financial foundation.
Consolidated Cash Flow Statement
| Item | 2024 (£m) | 2023 (£m) |
|---|---|---|
| Net cash from operating activities | 4,382 | 3,722 |
| Net cash used in investing activities | (1,283) | (1,123) |
| Net cash used in financing activities | (2,978) | (2,605) |
| Net increase in cash | 121 | 4 |
Net cash from operating activities rose to £4.4 billion, showcasing strong cash generation. The company invested £1.3 billion in its operations and returned £3.0 billion to shareholders, balancing growth and returns.
These figures highlight Tesco’s financial health and its capacity to support ongoing investments and shareholder value.
Shareholding Details
Tesco’s shareholder base includes significant institutional investors who influence its governance and strategy. As of 24 February 2024, major shareholders are:
- BlackRock, Inc.: 5.02%
- Schroders plc: 4.99%
- Norges Bank: 3.99%
These stakeholders hold substantial stakes, reflecting confidence in Tesco’s long-term prospects. Their involvement ensures a focus on sustainable growth and shareholder returns.
Investment Details
Tesco maintains a strategic approach to investments, balancing passive holdings with active capital allocation. While specific details on passive investments are limited, the company holds various financial assets to support its operations.
A key investment initiative is Tesco’s share buyback program, launched to return value to shareholders. By April 2025, Tesco plans to repurchase £1 billion worth of shares, funded in part by the sale of its banking operations to Barclays, expected to yield approximately £700 million. This move underscores Tesco’s commitment to optimizing its capital structure and enhancing shareholder value.
Future Investment Plan
Looking ahead, Tesco is poised to invest in areas that drive growth, improve customer experiences, and align with societal trends. Key focus areas include:
- Digital Transformation: Tesco aims to enhance its online platforms and leverage data analytics to personalize customer interactions, ensuring it remains competitive in the digital retail space.
- Sustainability Initiatives: The company is committed to achieving net-zero emissions, promoting sustainable sourcing, and supporting community programs, reflecting its responsibility toward the planet and its stakeholders.
- Store Network Optimization: Tesco plans to refine its store portfolio, adapting to changing customer preferences and market conditions to maintain efficiency and relevance.
- Workforce Investment: Supporting its employees through training and development remains a priority, ensuring a skilled and motivated team.
Additionally, Tesco intends to continue returning excess cash to shareholders through dividends and share buybacks, supported by its strong cash flow generation. This balanced approach positions Tesco for sustained success in the years ahead.
Conclusion
Tesco PLC is a retail leader with a rich history, diverse operations, and a clear vision for the future. From its extensive store network and innovative services to its robust financial performance and strategic investments, Tesco exemplifies resilience and adaptability. As it continues to prioritize customer value, sustainability, and shareholder returns, Tesco remains a trusted and influential player in the global retail industry.
What is Tesco PLC and what does it do?
Tesco PLC is a leading multinational grocery retailer operating in the UK, Republic of Ireland, Slovakia, Czech Republic, and Hungary. It serves millions of customers weekly through large stores, convenience outlets, and online platforms, offering affordable, healthy, and sustainable food. Beyond retail, Tesco provides services through Booker (wholesale), dunnhumby (data science), One Stop (convenience stores), Tesco Bank (financial services), and Tesco Mobile (telecommunications). Its mission is to serve customers, communities, and the planet a little better every day.
When was Tesco founded and how has it grown?
Tesco was founded in 1919 by Jack Cohen, starting as a market stall in London’s East End. It became a public company in 1947 and pioneered the self-service supermarket model in the 1950s. Over the decades, Tesco expanded its store network, diversified into non-food items, and entered international markets in the 1990s and 2000s. Today, it operates in multiple countries with a focus on its core markets.
What products and services does Tesco offer?
Tesco offers a wide range of groceries, including fresh produce, packaged foods, and household essentials, as well as non-food items like clothing, electronics, and homeware. Its store formats include large superstores, convenience outlets, and online platforms. Additionally, Tesco operates Booker (wholesale), dunnhumby (data science), One Stop (convenience stores), Tesco Bank (financial services), and Tesco Mobile (telecommunications), providing a diverse array of services to customers.
What is Tesco’s brand known for?
Tesco’s brand is known for its commitment to value, quality, and sustainability. Initiatives like Aldi Price Match, Clubcard loyalty program, and Low Everyday Prices ensure affordability. The company also emphasizes sustainability through responsible sourcing, carbon reduction, and community support, making it a trusted name in retail.
Who are the key members of Tesco’s board of directors?
Tesco’s board includes Chair Gerry Murphy, Group CEO Ken Murphy, CFO Imran Nawaz, and non-executive directors like Stewart Gilliland (Sustainability Committee Chair), Byron Grote (Senior Independent Director), Carolyn Fairbairn, and Karen Whitworth (Audit Committee Chair). Each brings expertise in retail, finance, sustainability, and regulation.
What companies does Tesco own or partner with?
Tesco owns Booker (100%, wholesale), dunnhumby (100%, data science), One Stop (100%, convenience stores), and Tesco Bank (100%, financial services). It also partners with O2 in Tesco Mobile (50% owned), a leading mobile operator.
Where does Tesco operate and how many stores does it have?
Tesco operates in the UK (3,786 stores), Republic of Ireland (170), Czech Republic (184), Slovakia (169), and Hungary (197). The UK is its largest market, followed by Central Europe and Ireland.
What are Tesco’s recent financial performance highlights?
In 2024, Tesco reported group sales of £68.2 billion (up 7.4%), operating profit of £2.8 billion (up 11.6%), and profit before tax of £2.3 billion. Net assets stood at £16.8 billion, reflecting strong financial health.
Who are Tesco’s major shareholders?
Major shareholders include BlackRock (5.02%), Schroders (4.99%), and Norges Bank (3.99%), indicating confidence in Tesco’s long-term prospects.
What is Tesco’s investment strategy?
Tesco’s investment strategy focuses on digital transformation, sustainability, and workforce development. It also launched a £1 billion share buyback program, funded in part by the sale of its banking operations.
What are Tesco’s future investment plans?
Tesco plans to invest in digital platforms, sustainability initiatives, store optimization, and workforce training. It also aims to return excess cash to shareholders through dividends and buybacks.
