In a bid to win back shoppers from Lidl and Aldi, Tesco has launched a new discount chain, Jacks, with the promise of it being the cheapest in town.
The chain will sell low priced, predominantly local British food according to Tesco’s chief executive, Dave Lewis. Jack Cohen, the supermarkets founder, named the stores after himself, the first two of which will be opening this coming Thursday.
Jacks will stock about 2600 products, considerably less than the typical 25,000 products found in a large Tesco store but around the same as an Aldi or Lidl. 70% of the products will be branded as Jacks, from cheese to fresh meats. However the store will also sell about 700 branded lines such as Coca-Cola.
The first Jack’s stores can be found in the small Cambridgeshire town of Chatteris and Immingham, Lincolnshire. They had been empty since 2004 when Tesco was rocked by an accounting scandal and had to left empty.
Aldi signalled it could launch a fresh round of price cuts in its Chatteris store, which is less than a two-minute drive away, in response to Jack’s claim to be the cheapest in town. Aldi spokesman claimed their customers will always pay the lowest grocery prices in the UK.
Nearly doubling their market share to 13.1% in the last five years, the German retailers Aldi and Lidl have shaken up the UK grocery trade. Their growth continues to far outpace that of traditional supermarkets. Tesco has hired the former Aldi executive Lawrence Harvey to run Jack’s.
Jack’s stores follow the familiar basic layout of an Aldi or Lidl, with wide aisles and products stacked on pallets on the shop floor to save time and money. There is an aisle devoted to promotions on big-name grocery brands, such as Kellogg’s Coco Pops and McVitie’s Jaffa Cakes, which will change every few weeks. Jack’s stores will have polished concrete floors instead of tiles to keep costs low and will have fewer staff than a Tesco of the same size. Workers, who will wear their own clothes rather than a uniform, will earn more in basic pay per hour than Tesco staff – £9 per hour.