The catchphrases are as much a part of modern culture as X Factor, Celebrity Big Brother, The Apprentice and all the rest of the unstoppable 21st century zeitgeist. Every Little Helps.....Live Well for Less...Always Low Prices...Why Pay More?
You could almost be staring at the track listing on an irredeemably naff Phil Collins or Mick Hucknall compilation. But ignore such gratuitous jibes – these are, of course, the everyday mantras of the big beasts of the supermarket jungle.
But, after years of retail domination, something is stirring down in the jungle.
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And it doesn’t make for agreeable news for the likes of Tesco and Sainsbury’s, or indeed Morrisons and Asda.
Tesco, of course, is in something of a pickle of its own making after a £250 million ‘hole’ was discovered in its profit forecasts. The retailer hailed for years as the biggest shopping beast of them all has been caught with its metaphorical trousers down after inflating its profit forecasts.
Tesco has announced its own inquiry, led by Deloitte and Freshfields.
August bodies from the Financial Conduct Authority to the Financial Reporting Council and even the Serious Fraud Office are on alert, while eight senior executives have been asked to step aside while investigations continue.
Tesco may have its own particularly pressing problems, but it’s not alone in feeling the heat from the competition.
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Last weekend respected ratings agency Moody’s announced that the big four were fighting a losing battle against German discount chains Aldi and Lidl.
Moody’s said cost-cutting by the retail world’s equivalent of the Premier League’s Champions League elite would leave them with permanently lower profit margins.
It said ominously: “The Big Four will have to cut prices further to stem their sales declines and slow market share losses,
“Aldi and Lidl are now entrenched and their combined market share could reach 10 per cent over the next couple of years from 8.3 per cent today. Over time the discounters’ 海角视频 market share could be similar to that of discounters in other European countries at around 12 per cent to 15 per cent.”
Moody’s said the Big Four would never recover their historic profit margins of around five per cent since “the competitive landscape in the 海角视频 is becoming more like other parts of Europe, where discounters are well entrenched and average grocery margins are more like three per cent to four per cent.”
It seems the glory days of the big four may be over after years of relentlessly crushing the competition, from High Street butcher’s to the local fishermongers and cheese shops.
So what has gone wrong for Tesco and co, dodgy profits forecasting and cutprice German opposition notwithstanding? It’s a cautionary tale of modern Britain, and was admirably summed up recently by a discerning gentleman called Phillip Adcock, head of retail research firm SBXL.
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Mr Adcock lays the blame for the decline of the Big Four firmly at their own doors, suggesting that they are so obsessed with fighting each other and their suppliers they have forgotten about the people who pay the bills, the customers.
He says: “In a nutshell, retailers and the brands that supply them have been locked in an ever more artificial war. Each is spending their time fighting each other, with the stores wanting to find new revenue streams from the brands, and the brands trying to find ways to retain some margin.
“In this spreadsheet-based situation, reality takes a back seat and decimal points drive the bus. In all the furore, one vital aspect of commercial common sense has been ignored – the needs of the customers: shoppers, those apparently insignificant individuals who are responsible for the wages of supermarket executives and brand account managers.
“If the shoppers don’t shop, businesses fail.
“The answer for the supermarkets is remarkably simple: Stop behaving as one big trade negotiation and go back to serving customers. Give the shoppers what they want and they’ll come.”
There are corporate parallels to be drawn from Mr Adcock’s splendidly forensic analysis of Britain’s supermarket chain woes.
The big supermarkets are not alone in forgetting what made them successful in the first place, and ignoring the needs of the customer.
We only have to go back six years to the banking bailout crisis of October 2008 to consider how the big banks lost touch with reality and almost brought the world crashing down with them.
The likes of RBS and HBOS became casino-type operations under the control of corporate chancers like Fred ‘the Shred’ Goodwin and Andy Hornby, reinventing themselves as roulette wheel spinners rather than responsible lenders.
Pub groups shut the breweries and became part-property groups, sometimes with disastrous consequences.
The Big Beasts of the Premier League, their coffers inflated by satellite television revenues, became ‘global brands’ as keen to flog replica shirts in the Far East as they were in pumping up the ticket prices for the very lifeblood of the game, the loyal spectator.
In the dash for cash – which is what the supermarkets, the banks, the pub groups and the Premier League giants are really all about – the little man, in the shape of the customer, got trampled underfoot.
In this context, the words of Phillip Adcock deserve repeating: ”Stop behaving as one big trade negotiation and go back to serving customers.
“Give the shoppers what they want and they’ll come.”