Tesco takes on Aldi and Lidl as new store Jack’s to be ‘cheapest’ in Britain
TESCO has launched a new store called Jack’s as it attempts to take the fight to German discounters.
The brand is being widely hailed as a challenger to Aldi and Lidl, which have eaten into the market share of the supermarkets.
Like the German duo, Jack’s stores will have lower operating costs than Tesco outlets due to their smaller range of products and simplified design. Tesco plans to open between 10 and 15 branches over the next year in the UK, investing at least £20m (€22.5m) in the project and creating 250 jobs.
Tesco boss Dave Lewis said the prices would be “the cheapest in town” at each location. He added that the move, under discussion at the supermarket for more than two years, is in response to consumer desire for a “smaller, simpler range at shops”.
Jack’s will carry 2,600 lines compared with tens of thousands in Tesco. Of these, 1,800 will be own-brand products under the Jack’s label, sourced from the Tesco supply chain.
The first two English stores are to open today in Chatteris, Cambridgeshire, and Immingham, Lincolnshire, at formerly “mothballed” Tesco sites.
Mr Lewis admitted that staff at Jack’s would not be paid the same as employees at Tesco stores, but would instead be on “more of a base-rate pay”.
Unlike Tesco, Jack’s will not have an online offering and customers will not be able to use their Tesco clubcard.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said shoppers were unlikely to visit Jack’s regularly.
“Plenty of people buy from Aldi and Lidl – around 60pc of all households shop in each of the discounters at least once a year,” he said. “However, they spend just £1 in every £10 there and don’t shop at the discounters as frequently.”