Sir Terry Leahy has announced he is to resign as CEO of Tesco. Leahy, who started his Tesco career as a part-time shelf stacker 40 years ago, will leave the world's third-largest retailer in March, aged 55, after a 14-year stint at the top. Another Liverpudlian and erstwhile shelf stacker, Philip Clarke, currently head of Tesco's international operations, will replace him. Clarke is only the sixth boss in the company's 80-year history.
What the commentators said
Leahy "has presided over one of the great British corporate success stories", said Edward Hadas on Breakingviews. Revenues and pre-tax profits have grown at an 11% annual rate during his tenure. In 1997, Tesco earned £750m from sales of £15bn; last year it made £3.4bn from £63bn of sales. Leahy has extended the Tesco brand "from one that sells bread and baked beans into one capable of selling practically any goods and service in just about any country in the world", said Clive Black of Shore Capital.
Tesco's success is based on "a mix of innovation and far-sightedness", said the FT. The Clubcard loyalty programme, a concept pioneered by Leahy, tapped a "deep well of information about customers' shopping habits" and has been adopted by other retailers. Tesco also began to plot its gradual overseas expansion long before it was reaching saturation point in the UK (the process began in 1998), becoming "international in a business that is notoriously local". By bowing out "at the top of his game", he again demonstrated sound judgment, said Tracy Corrigan in The Daily Telegraph. Few CEOs, especially retailers, know when to call it a day. His caution, attention to detail and love of the business are "depressingly rare" traits in CEOs.
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