Never miss a blog....get your retailiation first

Showing posts with label Walmart. Show all posts
Showing posts with label Walmart. Show all posts

Wednesday, 23 April 2014

Tesco: That David Moyes feeling...

Manchester United's ten month disastrous flirtation with David Moyes is over. To many, he had been "dead man walking" for months. Despite long-terms critics like myself incessantly calling for his head even before he was appointed, the prevailing mood among the faithful had been to tough it out. 


Moyes was Sir Alex Ferguson's pick and who could argue with that? I never understood the call to give him more time.  After all, why would you give a failing arsonist this luxury? Out of all competitions and no European football for the first time in two decades, time finally ran out for Moyes.



There are some striking parallels between Manchester United and Tesco - organisationally and managerially. Organisationally both have been at the top of their game for the past twenty years. 

Both had  leaders, peerless in their domestic arena who anointed their successors and both business models have been changing profoundly with the influx of massively funded competitors arriving seemingly from nowhere.

For United, the arrival of Abramovitch at Chelsea brought the first high profile billionaire in to the public glare but it is Sheikh Mansoor's arrival at Manchester City and his impending purchase of a new NYC MLS franchise that changed the game. At the same time the Qatari's bought Paris Saint Germain in France and spent $145m on new players last season. United, in transition, have been caught flat-footed.

In mass retail, Tesco are being outplayed by international competitors. Aldi and Lidl from continental Europe, Walmart in USA and UK. But it's the new, next generation giants Amazon and Alibaba that threaten to overwhelm mass retail globally. Tesco have plenty of ideas; possibly too many, without the bandwidth to deliver. Last week's announcement of the decision to open seven F&F Franchise stores in Boston was dwarfed by Uniqlo's declared intention for global fashion domination.

When Philip Clarke recently noted "bigger is no longer better", he was hinting at a problem Manchester United are also facing. Patchi prove how small focused retail businesses can deliver outstanding concepts - way better than anything a mass provider can execute. This is fine for niche, but neither Tesco or United are niche propositions. It's not “big isn't better”; it's more "the new big is bigger" - and for both soccer and mass retail, to play in the “new big world”, you need to have a deep reservoir of international cash to compete.

Asda (Walmart), Boots (Alliance-Walgreens), Aldi (Albrecht family), Lidl (Schwarz family), Sainsburys (25.99% owned by PSG's Qatari Sovereign Wealth Fund) and Superdrug (AS Watsons) appear to have the ownership structure to provide access to external capital. 

Tesco, big in local terms, may need a stronger, internationalised financial backer to secure their long term competitive future. Of concern, Berkshire Hathaway, one of Tesco’s two main institutional shareholders have been reducing their exposure. Similarly, United need to find investment minded billionaire owners to underpin their future.

In the ultimate paradox, United who have fallen furthest will turn around fastest.  United will hire a globally recognised football giant, who in turn will be given $150m and eighteen months to rebuild. Tesco, by contrast, retain their UK's #1 position, but their grip on share is slipping with challenges across their business model. None of this disappears whoever is in charge

Despite a torrid season and all the popular commentary calling for Moyes' exit, once the narrative became front and back page news, his position was untenable. 

Tesco has similar problems. Last weekend's heavyweight papers were filled with negative critique. Journalists are talking with fund managers: they speak of leadership replacements. The narrative is who and when, not if.  Interestingly, former Tesco executive Tim Mason, fancied by some as Clarke's replacement, broke his fifteen month twitter silence last week, referencing two damning articles on Clarke's reign. The jockeying is well and truly under way.

It was never going to be easy filling their respective predecessors' shoes. Both Moyes and Clarke inherited organisations that had over-traded their pasts whilst competitors were investing for new tomorrows. If Philip Clarke reads today's papers he might be forgiven for feeling he has been visited by the ghost of Christmas future. It's that David Moyes feeling...

Tuesday, 8 April 2014

Asda's new strategy: EDMP

Asda, famous for EDLP (every day  low prices), launched the latest salvo in the UK grocery retail war. Presented as part of a package of 12,000 jobs over the next five years,  the underlying message was meant for Tesco: 

Walmart is serious, Walmart is investing, Walmart is coming South  and this is a five year plan bringing  40 new conventional superstores, 100 new supermarkets, 150 forecourt shops, 1,000 new click-and-collect points and greater online penetration. Ouch.

This was a master stroke of publicity for Walmart, announced by CEO,  Doug McMillon, under the approving gaze of UK Premier David Cameron, it places an ever greater spotlight on Tesco and their preliminary results in eight days time. The markets will be looking for some positive news.  EDMP? You guessed it..."Every day more pressure".

Tuesday, 1 April 2014

Sir Philip Green's Lottery Tickets

"Maybe it's an opportunity.."
Commenting on BHS's move into food retailing, Sir Philip Green said "On the basis that everyone is going into the high street and convenience, maybe it's an opportunity. If you don't buy a ticket, you can't win the lottery."

Given M&S and Waitrose have already made such a success of premium food retailing, the move into food isn't surprising. The £1 round pound price pointing is.  

Tied to brands, lower prices than the majors, Booker's supply chain and a maximum 50 BHS outlets selling food in the next six months, there doesn't seem to be a whole lot of money to be made...Hardly a lottery win.. and Sir Philp has no passion for food retailing, never has. So why jump into the UK Grocery price war unnecessarily?

Green bought BHS in 2000 for £200million and has been re-shaping it ever since. In 2006 he began discussions with Asda and Debenhams to sell BHS but market conditions were just too tough, the timing wrong. In the intervening years, absorbed inside Arcadia,  a number of stores were sold off to Primark, the discount clothing retailer. 

When Green says "everyone is going into the high street and convenience" - his "everyone" is other retailers. The real lottery tickets are BHS' outlets.

Re-enter Asda. The George clothing range could plug and play into existing BHS stores, their grocery supply chain can deliver low price food everyday....The environment is still tough but Asda are now looking for growth beyond superstores. It's all about the timing..

The "for sale" sign has been nailed over the BHS estate. Sir Philip just needs to grab some attention and prove BHS stores can sell great value food to price conscious shoppers to sell BHS to Walmart. "Maybe it's an opportunity". 
Winning lottery tickets indeed!



Monday, 24 March 2014

The New Alchemists

Alchemy: Magic and gold: we all love it, always have, always will. Investors are no different - in fact, they are the worst: they back their dreams with cash (often other people's).

The dotcom bubble of the 1990s was fuelled by the wizardry of high tech Harry Potter's punctured only when commercial reality, dressed like the little boy in the Emperor's New Clothes shouting "you've got nothing on", burst through.

As much as investors love alchemy, they are nonchalant of reality. History is irrelevant, tomorrow is everything. This is why Amazon has a market capitalisation of $165.6bn and trades on a P/E ratio of 1307; whilst Walmart's market captilisation of $246.6bn is a paltry P/E of 14.6
Valuing a company on a forecast of a millenium of earnings seems like the hubris of the Third Reich declaring it will last a thousand years. One thing is certain: new players will arise, innovate and encroach. Just ask Nokia and Kodak.

The market is addicted to alchemy and when Alibaba floats, the markets will scream "Open Sesame" and likely place a valuation of between $150bn - $250bn on the business

The message is simple - alchemists spin enticing visions of future riches...but at some point, reality will catch up and tomorrow's businesses become today's stalwarts and markets fall out of love. The correction in value will be devastating.

We hope you enjoyed the show, magical wasn't it?







Monday, 17 March 2014

Digital Kills The Retailing Stars (A retrospective from 2011)

Written 3 years ago - "Digital Kills the Retailing Stars" was written in the aftermath of the collapse of Woolworths in the UK. Given all the changes kicking around at the moment, I thought it was worth dusting off and sharing. No apologies for the length....have a coffee...
Two things I didn't foresee: Tesco Hudl - an undoubted product success and the rise of pound stores.....Let me know what you think, all comments appreciated....enjoy!


Digital Kills the Retailing Stars
The future of retail as we know it is hanging in the balance. From Cheshunt to China, digital is reshaping the course of retail developments.  There are particular dynamics in emerging economies with little historic exposure to Western retailing norms and the questioning logic is “to what extent will they need and/or acquire them? “ It is different in mature economies where big box is the common retail denominator, isn’t it?

4 connected ideas are emerging and joining up the dots creates some fascinating pictures. Of course this won’t be a universal pattern but it provides a coherent sense of retailing in the post-modern phase and it is a future that is rapidly approaching.

1.    Digital Tsunami

There appears to be a digital tsunami inexorably moving, albeit at different paces, throughout the retail universe.  Plausibly, the forces inhibiting big box development in China will simultaneously sweep away irrelevant, non-value adding retail in mature markets. 

Picture a huge tidal wave overwhelming all that stands in its path. Two groups of mature retailers are already feeling the full force of this surging power: 
  • Retailers whose businesses have an easy propensity to be purchased on-line. We have already experienced and/or are in the midst of witnessing a fundamental reshaping of retail categories including Music & Entertainment, Books, Gambling, Insurance, Consumer Electronics, Travel, Property, Greetings Cards and Banking etc
  • Retailers whose business model was so fragile that any material loss of revenue was sufficient to push them over the edge. In the UK, perhaps the earliest casualty was the Woolworth’s group that collapsed in 2008/09 as their Music and Entertainment sales evaporated under the Apple / Amazon revolution, disrupting their total commerciality. And we know there are many lining up to join them like Jane Norman, Comet, Carpetright et al


This is a hungry tide and no one knows where its path will lead and how much land will be 
consumed.  But as with all seismic shifts, the landscape is being irrevocably resculpted.

2.    What happens when your greatest strength becomes your Achilles heel?#

The seeds of this question are sown in the post-apocalyptic fall-out that follows the demise of these early casualties and it comes with the realization that retailing is, de-facto, a fragile model.
For many years, major suppliers have invested time in training their own people and developing presentations to justify why manufacturers’ margins are justifiably so much stronger than retailers. Manufacturers invest in new technologies they need to fund R&D; major retailing is a scale cash business – so focus on cash generation, GMROII etc and be satisfied with low single digit margins.
The trouble is, no one considered what might happen when business starts flowing from mature big boxes? How much contraction can be tolerated before even the best retailers hit  Gladwellian “Tipping Points?”  The best worst-case scenario, sees retailers like Tesco build strong on-line propositions – but this doesn’t necessarily help.

Retailing is a “Stock, Pack, Pick, Pay, Ship” business. It moves products from suppliers to retail distribution centres (Stock) on onwards to store shelves (Pack); from shelves to shopping baskets (Pick); through the tills (Pay) and to the shoppers home (Ship).  Conventionally, off-line retailers absorb the larger part of the Stock, Pack and Pay activities; whilst shoppers bear the burden of Pick and Ship. In recent years, a good deal of technology has been applied by retailers to bring their costs down – e.g. Cross-docking, Shelf Ready Packaging, Ship to Display Pallets and Self-Serve Tills help bring down significant chunks of the cost model. ”

With on-line retailing, major grocers have to take on Pack, Pick and Ship with decreasing ability, in the face of rising competition, to pass any of the cost increases back. (Initiatives like Tesco’s “Click and Collect” – dressed as a shopper benefit, are really just attempts to put the “Ship” costs back into the shoppers pocket).  Under such conditions, even growing sales from competitors is likely to be margin dilutive. Once you start including the spiralling costs of promotions into the retailers economics, it becomes quickly evident how, even profitable, business models can be undermined by relatively small  on-line volume shifts.

And there’s another problem. Where to do the picking? If it’s a store pick based model, it is cost-additive and margin dilutive. If you go the dark-store route, it drives sales out of existing outlets. Either way, it is bad news.

Second, many major retailers expanded their businesses by entering non-grocery categories – many of which are in the previous list of digitally transformed businesses.  Whilst they looked opportunistic in pre-tsunami times, they are part of the risk to be contained from now on – and will be the first areas where business loss will be experienced.

All these factors are concerning but the real “aha moment” centres on the historic strength of major retailers; the real estate footprint. Millions of retail square footage and with it the ability to serve millions of shoppers every day from prime retail locations. 

Having spent decades building land-banks and property portfolios, it is common practice for major retailers to leverage the value of these assets by entering into sale and leaseback agreements with property developers. This takes assets off the retail balance sheets, provides investment capital and commits the retailers to long term leases with guaranteed annual rental escalation formulas.

Here is a recent example from January 2011

Prupim has completed the £125m purchase of three supermarkets on a sale-and-leaseback basis for M&G’s Secured Property Income Fund. The real estate fund manager has bought three Sainsbury’s superstores in Worcester, Truro and Huddersfield. The leases at stores are for 25 years, with RPI-linked rent reviews. Source:  PropertyWeek.com

But it’s not a new phenomenon. A similar article in 2004 noted

Tesco yesterday raised more cash for acquisitions by selling off 33 of its UK stores for £650m. The stores, which range in size, have been sold to a joint venture that is half owned by Tesco and real estate firm Topland. Tesco has also sold two distribution centres in the deal. Tesco's £650m cash will come from issuing bond debt, which will be secured on the rent that it will begin to pay for the properties. Tesco will rent the stores on a long leasehold and carry on running the operations, so customers will not see any change.  Topland, has done similar sale and leaseback deals with retailers Marks & Spencer, Littlewoods and Budgens. The Guardian, Tuesday 23 March 2004

Taking the UK as an example, the implication of a significant retail contraction  and the exodus of household brands from the high street, may well be falling commercial retail property value and rental costs. With commodity prices still having the potential to fuel cost price inflation, this is not a great moment to find yourself with long-leases, large stores, lots of them, increasing on-line competition and guaranteed inflation-linked rental increases.

It creates a toxic mix where major retailers may find themselves unable to operate stores profitably and unable to affordably close them. They could try and renegotiate the rents – but why would property companies who bought the assets in a much stronger climate want to deal?  Their only dependable asset is the rental income.

Suddenly, retailers’  biggest assets become a major headache, underpinning a structural erosion of the competitive model and reducing their abilities to respond to newer, trimmer more agile competitors unencumbered by these legacy challenges.

Put simply:  Big box retail in mature markets is under threat.

3.      The end of Tesco?

Really? Tesco? Game Over?? Accepting this is a rather extreme proposition, it’s worth considering what Philip Clarke, the new Tesco CEO, said to the British Retail Consortium in his key note address last month (June 2011)

“….in this digital world, great service, value, convenience, price – these things are no longer enough to win customers’ loyalty. More than ever before, customers’ decisions about what they buy are likely to be influenced by the power of brands”

This could have come straight from the mouths of AG Laffley  or Paul Polman. But it didn’t. It came from a top global retailer and its conclusions are far reaching. First, Clarke implicitly acknowledges some of the retail challenges we set out above. Second, if you follow through with this stream of consciousness, it has the potential to destabilize the Tesco model as we currently understand it.

Even aspiring to be the best retailer in the world, is not enough for Clarke. Tesco’s future is as a brand builder and he goes on to reference, by example, the importance of the Technika house brand as a lead play in Tesco’s consumer electronics business. Clarke goes further:  his new strategy for Tesco includes the expansion of Tesco services to more parts of its footprint.

So brand building for Clarke means building the Tesco retail brand, stretching it further and wider across more services and markets, whilst developing and supporting Category specific sub-brand propositions. Tesco already has its fair share of critics, uneasy about its UK market strength and others who believe that its ubiquity and utilitarian ambitions, trying to be all things to all people, risks mushing it into a mire of muddled mediocrity.

As if to push the point harder, days after Clarke’s speech, Tesco committed a major faux pas in mishandling the transfer of Tesco Bank Accounts from RBS, leaving thousands of customers without access to their funds. BBC Radio 4s Money Box programme featured the problem and despite Tesco’s best attempts to front up and downplay the issues, there was no mistaking the customer anger. Many vocalised their intention to cease banking with Tesco.

And here’s the rub. The broader your brand, the more equity management required and the more potential for fowl ups. Once your PR starts turning negative it’s hard to recover. Ask Gordon Brown.  Long before we consider the real prospects of success of Tesco taking on the likes of Samsung and LG and winning the consumer electronics war with their house brand, Tesco’s ubiquity may yet turn out to be their Achilles heel and Philip Clarke’s brand build plans, one stretch too far. So whilst, I am only half serious in sounding the death knell for the folks at Cheshunt – they have more challenges ahead of them, and tougher ones, than they’ve encountered in the last twenty years.

4.      Brands reclaiming ownership of the consumer/shopper relationship

Don’t get me wrong, I might disagree with Philip Clarke’s response, but he has put his finger on another massive challenge for today’s retail giants: “Who owns the shopper?” For the last fifteen years we have all been working with a simple governing dynamic : “retailers, having become more powerful, can and do exercise a great deal of influence over shoppers and act as,  crucial and not necessarily benign, interlocutors, in the parley between brands and consumers”.

Across the globe, major manufacturers engage with customers to protect their brand positions. P&G have long-since made an art of this and way before concepts like “shopper based value creation” were born, Tom Muccio was leading the first WalMart/P&G Global team with 140+ P&G associates based in Bentonville.  P&G decided to excel in this space out of necessity, not desire – their hearts were and will always be with the brands, consumers and shoppers.  Customers were recognized as critical arbiters of brand success. Put simply: engage or die. And if you are going to engage: engage and win.

Digital presents opportunities to stimulate fundamental shifts in the power balance in the battle for ownership of consumer and shopper relationships, enabling brand owners to reach shoppers and consumers with more precision than ever before and reclaiming a bigger stake of the profit pool.  Digital media and social networks Where historic brand communications were broad-brush and one directional, today they can be ongoing, multi-layered sets of intimate dialogues. Retail hegemony is no longer a given. The rules are there to be rewritten and P&G is keen to author them.

The shifting of vast amounts of money into digital advertising and communications is no surprise. Their desire to invest in more forward looking rather than rear view research is instructive; but it is their eagerness to understand all things retail - on-line retail via, initially Ocado in the UK , the e-store in the USA, Tide Launderettes, The Amazing Shave stores, Branded Car Washes - that represents something of a qualitatively different order.  

It is widely rumoured,  P&G would like to see c15% of their global sales operating on a direct to consumer model within a medium term span - (and why not, after all, two of their global competitors, Avon* and Amway**  have never put their products anywhere near a Walmart store). This is no thirty-minute diversionary tactic – this is game changing for the next thirty years

If Philip Clarke thinks Tesco needs to be a brand builder, perhaps P&G reckons they can regain control of their own destiny by mastering on-line retail and capturing consumer/shopper relationships in ways previously undreamed of. You don’t need the square footage – you just need great product , effective ongoing consumer / shopper relationships, backed up with stunning fulfillment. Amazon began with books and today they sell.....

The consumer relationship renaissance, commercial opportunities for suppliers and the value implications for shoppers could prove an irresistible combination as economies downshift and consumers seek ever improved value. Such innovations will suck more volume out of the established retail environment and even retailing goliaths may be toppled by digital slingshots.

Digital may not have quite killed the retailing stars yet, it has claimed an increasing number of b-listed actors, and the waters are still rising.  In 10 years we might be asking “Do you remember when Tesco had superstores? In 20 years, “Do you remember Tesco?”  And, as with all tsunami’s, by the time you see it for sure, it’s way too late.

Sunday, 16 March 2014

Retail Revolution: "Shoppers of the world unite, you have nothing to lose but your (retail) chains".

The UK retail industry is in turmoil. With problems at Morrisons and the Coop threatening their survival; Phil Clarke's speech at retail week seeking to make a virtue of freneticism. Change is in the air; a retail revolution even

The revolution is structural, multi-dimensional and polarised. It's not just mobile internet access transforming the way we "search and purch". There is a revolutionary dynamic stretching across Amazon, Groupon, Aldi right through to Poundland and Boohoo.com. Not forgetting B&M coming to market soon with Sir Terry Leahy on board. Discounting is front and centre

Talking of revolutions, last week marked the 127th anniversary of Karl Marx' death. Some of his ideas illuminate the challenges facing established retailers facing the discount onslaught. No really, they do.


Marx saw economics as the prime mover of change.  As economic power disperses, the dominant forces (thesis) are challenged by new participants (antithesis) and the outcome of the clash would be a new, higher order economic status quo (synthesis), with communism the end of history.  Historical Materialism 101, got it?

Successful discounters are anti-establishment value re-setters and all about economics. They combine high quality with unmatched value chains. Whether it was M&S putting shirts and shorts on Britain's backs and bums (by building direct relationships with suppliers and cutting out wholesalers); Jack Cohen's "pile it high, sell it cheap" mantra in 1960s Tesco or Walmart's EDLP philosophy: these were all discounting models. Their success put a good many competitors out of business, creating a new retail establishment.

Discounters also thrive on the structural disadvantage others impose on themselves. In mass retail focus and simplicity are the partners of unmatched value chains.

When advantage is lost, death is inevitable. Kwiksave UK built a business selling a limited number of major branded SKUs, from small basic outlets at cut prices sustained on one advantage: centralised distribution. While Tesco, Sainsbury and Asda were still had suppliers making minimum drops to individual outlets,  Kwiksave were securing full-truck efficiencies, within a lower cost model and passing the savings on.  Once everyone else could match them, all Kwiksave had left were small untidy stores, a limited range of brands and no price advantage. Game over.

Retail value resetting has severe ramifications. The centralised distribution revolution, the first big data enabled shift, saw suppliers remove sales force organisations and focus on national accounts, outsourcing merchandising services to field force agencies. Expect the impact this time to be no less profound, with services like category management being outsourced to specialist providers.

Karl's theories were always more appealing than his solutions. It's probably why ordinary people connected with Marks & Spencer ahead of Marx & Engels. He was wrong about communism and never foresaw consumerism. If he had, he might have reworked his manifesto, urging: "Shoppers of the world unite, you have nothing to lose but your (retail) chains".  He shouldn't be discounted.

Tuesday, 11 March 2014

Tesco and the Art of War

“Victorious warriors win first and then go to war; defeated warriors go to war first and then seek to win.” So wrote Sun-Tzu in The Art of War. What then is to be made of Phil Clarke’s latest attempts to course-correct the UK’s retail behemoth?


Tesco’s world tour into Asia, the US, Europe, etc is in full-scale retreat with the Turkish operations’ restructure, the latest acceptance  of failure. The non-crisis crisis in Tesco Polska will inevitably lead to divestment. If anyone was in doubt: the world tour is over. Tesco went big; they are now coming home.

But while they were travelling, home changed. New competitors, formats and shopping habits have destabilised the core model. Hypermarkets are struggling. Tesco can’t revamp the retail estate quickly enough, and capital expenditure cuts along with foresaking their  5.2% margin promise mean strategy is being sacrificed to tactics, most  notably  £200 million of price cuts.

This is wallpaper.  Asda had already announced £200 million of price cuts themselves and has since added another £100 million to the fire. What no one else seems to have realised, and based on pure market share extrapolation, is  every £1 of price cuts Asda initiates costs Tesco nearly £2. So Tesco’s announcement just doesn’t cut it.

And let’s be frank, if the answer to your problems is to pick a fight with the world’s biggest price-focused retailer, you are dead before you start. Walmart’s pockets are deeper globally and shallower locally: they can stay the fight for longer, and it will cost them less.

Not forgetting, Tesco is hamstrung with Clubcard. The shining star of the 1990s Clubcard may fast become Tesco’s Tazo. (remember Tazos?)Affordable in times of growth, Clubcard risks becoming an expensive gimmick  obstructing visible value delivery. Worse still, with Tesco now accepting other retailers’ vouchers, expect Asda, Sainsburys  and Aldi to start dropping vouchers around Tesco stores in areas where they aren't trading. Ouch. 

Back to the end of the margin promise and no new commitment as to where the clock will get reset. The city vultures were already circling over the UK’s big three listed retailers to leverage out their property assets. This will now intensify: the repercussions may be profound.

The first move could well be “Coupe’s coup”. Sainsburys may use the cash pile generated to buy Morrisons and put themselves neck and neck with Tesco for the number one spot. This is the last big domestic grocery deal left and Coupe has to do something bold to make his mark. But liberated from their strong property asset based underpinnings, Sainsburys and Tesco will be left with big, cost hungry, unfocused (sorry, omnichannel) businesses under ever-increasing margin pressure facing up to a world of giants: Walmart, who won yesterday, Aldi who are winning today and Amazon, who stand to win tomorrow.

In response to all of this, Tesco jobs will go; the cuts have already begun. Expensive talent is being removed and the business is increasingly in the hands of younger, lower-cost managers lacking the experience to win the fight they face. Compare this to the vast array of Princeton, Harvard, and Oxbridge MBAs now stalking the corridors of Amazon UK along with the senior, proven buying talent fresh from Tesco and Asda.

What else can Tesco do? Well...whilst there is no Chinese medicine to fix these structural shifts in retailing, there is a compelling need to adopt new ways of working and breakout of historic operating cost structures. The race is on to take leverage big-data enabled technologies and take an axe to retail back office cost structures.


This will support a delayering of centre organizations, driving back-end costs down dramatically and allow bricks and mortar retailers to reconfigure and reinvest in store service and this is the critical point of difference to online competitors.  Sun Tzu also noted, “There is no instance of a country having benefited from prolonged warfare,” and Tesco faces prolonged war on every front with increasingly formidable rivals. Interesting times.