"It was billed as Tesco's worst Christmas for more than a decade," said Richard Fletcher in The Daily Telegraph. But take into account November's VAT cut, "and it was actually the worst performance since... last Christmas". Tesco's results were bang in line with City forecasts, with like-for-like sales up 3.5% in the seven weeks to 10 January. Last year it achieved 3.1%.
But with consumers ready to batten down the hatches, "it looks like it is going to be a very tough year ahead", said Andrew Higginson, the supermarket's outgoing finance director. Sales at discount stores such as Aldi rose 22% in December, providing stiff competition for Tesco's recently introduced "discount brand" line. Given that shoppers like consistency and simplicity, the new range could be the "first big mistake that Tesco has made in a decade", reckoned Planet Retail commentator Bryan Roberts.
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