Anthony Hilton: Tesco loses out in likeability stakes

Perhaps companies do reap what they sow.

Anthony Hilton: Tesco loses out in likeability stakes
Anthony Hilton: Tesco loses out in likeability stakes

One has to be struck by the contrasting treatment of Tesco and Sainsbury's in recent weeks in the media and the markets. The appointment last year of Philip Clarke as chief executive of Tesco coincided with a bigger squeeze on consumer spending and a souring of the mood towards the firm's effort to build a business in the US and the slow progress of its financial services business in this country.

But all these problems, including uncertainty about how the new leader would stack up against his predecessor Sir Terry Leahy, do not explain the severity of the loss of confidence in the business. Given its decades of remorseless growth, one would have thought Tesco had earned the right to be cut a bit of slack.

The mismatch is even more obvious when compared with the treatment meted out to Sainsbury's, where the chief executive Justin King got all the praise Tesco missed. Sainsbury's is a fraction of the size of Tesco, so it is a bit like comparing apples and pears, but no matter.

It should figure too that Tesco makes a better margin than Sainsbury's. But the way such reservations were cast to one side made one suspect the joy of celebrating Sainsbury's success was the sweeter because it seemed to come at the expense of Tesco.

It is interesting how all supermarkets have lost their connection with the opinion formers. Supermarket leaders used to be high profile characters who made an effort to engage with the media, markets and politicians.

These days, with the exception of King they are far less visible and there is a price to be paid. It is an open secret that Mary Portas' high street review was very anti-supermarket before it was watered down for publication. And last week's Queen's Speech outlined a bill that proposes to create an office tasked to ensure the supermarkets play fair with their suppliers.

Familiarity is supposed to breed favourability. With supermarkets this is no longer the case, and one has to wonder whether this is partly because the people at the top no longer make an effort to be known. It is so much easier to think the worst of faceless corporations.

Anthony Hilton, City commentator on London's Evening Standard

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