Tesco buy all nine Shoprite supermarkets- Monopoly?

[John Wright]

4 minutes ago, IOM said:

But that’s not the point it’s about what people are used to in the Isle of Man ( the “market “) .

Taking that one point.

IoM Shoprite shoppers were used to fewer lines and less choice in the 5 smaller stores, and higher costs, over their 9 store estate, than Tesco. Whats the difference?

[Roger Mexico]

11 hours ago, finlo said:

They have completely misread the market, I'll give it 18 months until there are only two or three outlets.

But the problem they have is they've tied into 21 year leases with the Nicholsons on all the sites.  So unless they're losing more than the rent, they're best keeping them going.

[TheTeapot]

24 minutes ago, John Wright said:

 

That leaves Castletown. 

So, for Castletown only, the questions that are relevant are

1. will the range of food lines be greater or fewer than carried by Shoprite

2. will the quality be better or worse than Shoprite

3. will the price of a shopping basket of identical or equivalent products be more or less than it was when Shoprite operated.

 

1. Fewer, much.

2. Worse, eg - Tesco new potatoes are awful

3. More, much

[Anthony Ingham]

30 minutes ago, John Wright said:

Yes. But no one is going to be more than 12km/7.5miles from a superstore and 80%+ of the population will less than 3 miles or 5km. Of those who used 4 out of the 5 Shoprite stores that are to be express branded the nearest superstore will be less than 2km/1.25miles.

That leaves Castletown. 

So, for Castletown only, the questions that are relevant are

1. will the range of food lines be greater or fewer than carried by Shoprite

2. will the quality be better or worse than Shoprite

3. will the price of a shopping basket of identical or equivalent products be more or less than it was when Shoprite operated.

That it’s an express isn’t relevant. Shoprite didn’t carry their full range of lines in Castletown, Michael Street, Village Walk, Winerite or St Paul’s Sq..

Even in UK not every superstore carries the same number of lines. It depends on floor space and what sells well.

1 less

2 seems about the same

3 more

[Anthony Ingham]

30 minutes ago, John Wright said:

Yes. But no one is going to be more than 12km/7.5miles from a superstore and 80%+ of the population will less than 3 miles or 5km. Of those who used 4 out of the 5 Shoprite stores that are to be express branded the nearest superstore will be less than 2km/1.25miles.

That leaves Castletown. 

So, for Castletown only, the questions that are relevant are

1. will the range of food lines be greater or fewer than carried by Shoprite

2. will the quality be better or worse than Shoprite

3. will the price of a shopping basket of identical or equivalent products be more or less than it was when Shoprite operated.

That it’s an express isn’t relevant. Shoprite didn’t carry their full range of lines in Castletown, Michael Street, Village Walk, Winerite or St Paul’s Sq..

Even in UK not every superstore carries the same number of lines. It depends on floor space and what sells well.

1 less

2 seems about the same

3 more

[IOM]

8 minutes ago, WTF said:

what budget options did shoprite have as they didn't have their own brand ?

They sold less well known branded  which across would be seen as budget options and indeed some products branded as Shoprite ( I think they bought them from Shoprite South Africa) . Also Shoprite used to advertise on selected products “Tesco price match “

[IOM]

34 minutes ago, Roger Mexico said:

But the problem they have is they've tied into 21 year leases with the Nicholsons on all the sites.  So unless they're losing more than the rent, they're best keeping them going.

Unless they had a break clause written into the 21 year lease . 

[Anthony Ingham]

40 minutes ago, John Wright said:

Taking that one point.

IoM Shoprite shoppers were used to fewer lines and less choice in the 5 smaller stores, and higher costs, over their 9 store estate, than Tesco. Whats the difference?

Any evidence that for example St Paul’s Square was more than any other shoprite?

[Roger Mexico]

25 minutes ago, John Wright said:

So, for Castletown only, the questions that are relevant are

1. will the range of food lines be greater or fewer than carried by Shoprite

2. will the quality be better or worse than Shoprite

3. will the price of a shopping basket of identical or equivalent products be more or less than it was when Shoprite operated.

That it’s an express isn’t relevant. Shoprite didn’t carry their full range of lines in Castletown, Michael Street, Village Walk, Winerite or St Paul’s Sq..

With respect to 1. there actually appear to be fewer lines in total in Castletown There's only half the freezer frontage (the other half is now chilled beer/wine not available before) and less frontage for other chilled - there's about 4 m of wall and an island gone.  The replacement cabinets are a different design so exact comparisons are difficult but there seem to be fewer chilled lines and they run out quicker.  I was actually surprised as I would have though ready meals etc was what Expresses specialised in, but there seems less choice than before and it feels harder to get things out and see what's there.

There are extra things that Shoprite didn't stock (or not in such number of lines).  There's a lot of concentration on Meal Deals and the like, so more space is taken up by sandwiches, crisps etc and individual bakery, fruit etc items.  This reduces the space for more standard items. 

There's a bit more space for fruit and veg and it's cheaper and usually better quality that Shoprite (which isn't saying much) though stock levels are often low.  The number of store cupboard and household lines seems less than not massively so but the lack of budget lines makes shopping them more expensive even without the 10-15% Express mark-up. 

Being an Express is relevant because what they have done is impose an Express template on the businesses, (judging Little Shoprite = Express) without considering the factors they would normally use when positioning an Express - lunchtime business traffic and number of commuters for example.

[emesde]

 

When the deal was done,I imagine Tesco would have been happy to take on less than all 9 stores.Im sure they would have preferred 1 in Douglas,1 in Onchan,1 in Ramsey. and  1 I Peel and 1 in the South.. However that wasn't what was on offer.Do you expect them to have 10 superstores for an island of this size and population?

As a business they operate 3 types of stores.Tesco Extra, Superstores, Tesco express.

They obviously planned to have grades of stores to fit in with their business and to give customer choice. As has been said earlier no-one is far from both types of store.which one you chose depends on your own circumstances.

 

[emesde]

35 minutes ago, IOM said:

Also Shoprite used to advertise on selected products “Tesco price match “

So now EVERYTHING is Tesco price matched👍🏻😂

[IOM]

8 minutes ago, emesde said:

So now EVERYTHING is Tesco price matched👍🏻😂

Not quite Tesco prices are now higher because they are not matching U.K. prices on quite a lot of products.

[IOM]

21 minutes ago, emesde said:

 

When the deal was done,I imagine Tesco would have been happy to take on less than all 9 stores.Im sure they would have preferred 1 in Douglas,1 in Onchan,1 in Ramsey. and  1 I Peel and 1 in the South.. However that wasn't what was on offer.Do you expect them to have 10 superstores for an island of this size and population?

As a business they operate 3 types of stores.Tesco Extra, Superstores, Tesco express.

They obviously planned to have grades of stores to fit in with their business and to give customer choice. As has been said earlier no-one is far from both types of store.which one you chose depends on your own circumstances.

 

I agree they probably didn’t want them all and in fact they should never have been allowed to acquire the leases of all the Shoprite stores and such a high market share . There is absolutely no way the competition authorities across would have allowed such a concentration of market power . 

[Gladys]

11 minutes ago, IOM said:

I agree they probably didn’t want them all and in fact they should never have been allowed to acquire the leases of all the Shoprite stores and such a high market share . There is absolutely no way the competition authorities across would have allowed such a concentration of market power . 

Not sure anyone had the power to prevent or allow the acquisition.  

[IOM]

Just now, Gladys said:

Not sure anyone had the power to prevent or allow the acquisition.  

They didn’t that’s exactly the point but they should have the legislation was not in place .