Tesco has reported significant growth in its clothing sector, reflecting a robust performance in non-food sales.
- The company’s quarterly sales increased by 3.4% on a like-for-like basis, amounting to £15.3bn due to clothing driving non-food division growth.
- Sales in the UK and Ireland reached £14.3bn, marking a 4.1% increase year on year, supported by easing inflation.
- Tesco’s strategic enlistment of Kate Ferdinand for its Active sportswear line has bolstered its clothing division.
- CEO Ken Murphy emphasized the company’s competitive pricing and growing market share in the retail sector.
In the recent quarter ending 25 May 2024, Tesco reported sales of £15.3bn, depicting a 3.4% increase on a like-for-like basis. This growth was primarily fueled by the company’s non-food division, particularly in the clothing sector, which demonstrated strong performance. The strategic expansion into clothing appears to be an effective driver for Tesco’s overall sales increase.
Sales figures for the UK and Ireland alone stood at £14.3bn, marking a 4.1% increase compared to the previous year. This rise is attributed to several factors, including easing inflation and increased consumer confidence. Tesco’s assurance of being the ‘cheapest full-line grocer‘ has likely played a crucial role in attracting more customers away from competitors.
To further fortify its clothing segment, Tesco appointed Kate Ferdinand in December to front its Active sportswear line. This move aligns with Tesco’s strategy to enhance its fashion offerings and expand market presence. Last year, Poeticgem, part of the PDS Group, launched a new brand to cater to the younger demographic for Tesco’s F&F fashion department, which aligns with current fashion trends and demands.
CEO Ken Murphy articulated the momentum Tesco has gained, stating: “We’ve continued to build momentum in the business, with strong volume growth across the UK, Republic of Ireland, and Central Europe supported by easing inflation.” He further highlighted Tesco’s commitment to maintaining competitive pricing, which is perceived positively by customers who are now choosing Tesco more frequently for their shopping needs.
Moreover, Tesco’s market share has seen substantial growth. Murphy noted that it is growing more now than at any other time in the past two years, with more consumers switching from other retailers and purchasing more per visit. This trend underscores the enhanced brand perception and customer satisfaction that Tesco is currently experiencing, driving its success in the competitive retail landscape.
Tesco’s focused strategy in expanding its clothing division has resulted in a significant boost to its non-food sales, strengthening its market position.
