Doctor Evil wrote:
Please do a little more homework. Tesco became successful because Jack Cohen was brave enough to take on a privately schooled university educated Scot called MacLaurin. He then made him work his way through the business for a few years, before living dangerously and telling him to run it and make the decisions. MacLaurin grew Tesco into a major and forward looking chain with excellent IT facilities. He trained Leahy and then moved on to Chairman (now retired) with Leahy as Managing director. Tesco's success is based on a slow steady growth pattern, with many options tried out on a small scale and the good ones invested in. I believe that Tesco is one of the few companies who would be capable of operating in the US market, which is normally death for most incompetent British company managements. So far they have decided not to enter. If you look at their investment pattern, they will only spend a few tens of millions of pounds in opening up a new market (petty cash for them), then they will grow steadily if successful or cut their losses if necessary. Their decision taking process appears to be outstanding, as I am not aware of any major hiccups in the last 10 years. Their management succession appears to work well. Their IT system is outstanding, streets ahead of any of the US (or other UK) grocers I have experienced, in terms of knowing which specific customers buy which products and promoting those products only to those customers. I regard buying Tesco shares as the single best investment decision for continuous long term growth that we have ever made. However, I buy wines from Lidl as Tesco are too expensive for cheap plonk which probably comes from the same place! Lidl is a useful place for "oddments" I find. So they provide a level of interest to a casual shopper which Tesco now lacks. Lidl's customer base appears to be the poorer end of society, and their products are often too cheap to be desirable to me. However, their chocolate products are far superior to the other major supermarkets.
Selling Morrisons shares was a no brainer decision when they took over Safeway on borrowed money. They had no IT facility worth a light and their shops offerings were not attractive to the southern preferences. When you merge two businesses and quarter the profits, you are incompetent. The interesting decision is whether to rebuy the shares on the basis of a European takeover--Carrefour?. Pension funds have very active selling positions when shares do not look like performing.
Regards Capitol