Monday 8 April 2013

No going back - Tesco faces £1bn writedown to quit America

The size of the charge, via a writedown in the value of Tesco’s assets, shows that even playing by the book, doing all the obvious research, means relatively little when the world turns upside down, especially financially….

Fortunately Tesco has achieved reasonable success in other markets, and remains No.3 in the global league. However, the real issue is that it will take a very courageous leader to attempt to re-enter the US market, when conditions improve..

Better to have left a small physical presence combined with an online offering to make re-scaling easier.
It remains to be seen whether the rest-of-world will provide sufficient scope for the realisation of Tesco’s global ambitions, and remain No.3…

‘Be prepared’
Meanwhile, suppliers have to consider their response to any Tesco moves in their direction, as the company attempts to repair the damage done to its Balance Sheet….

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