Tesco PLC (LSE:TSCO) could join its big four supermarket rivals in axing its fresh food counters in an effort to save on costs, according to reports.
Tesco still sells fresh items and products at 279 stores across the country, but the supermarket chain slashed deli counters from 317 stores in March, citing a change in consumer behaviours.
Further fresh food counter closures will likely lead to further job losses on top of those lost earlier in the year.
Competitor J Sainsbury PLC (LSE:SBRY) made the decision to close its in-store fresh food counters at the end of 2020 across all of its 420 locations.
Nick Gladding, a senior UK retail analyst at IGD said in the Speciality Food Magazine that these closures were the result of “an accelerated decline in customer use of in-store counters.”
“Improvements to the quality and merchandising of pre-packed deli lines means that fewer shoppers see the need to use a counter. At the same time, the expense of running counters, combined with the need to reduce costs to be more competitive, is prompting more large retailers to close them," Gladding added.
James Hardiman, a senior analyst at the British Retail Consortium, believes that the closures could open up a gap in the market for smaller, independent delicatessens.
“With some big supermarkets closing deli counters, there is an opportunity for independent delis and farm shops to capitalise on the potential gap in the market,” Hardiman said, also in the Speciality Food Magazine.
“The industry has always been incredibly effective at ensuring individual customer needs can be met by some resourceful retailer," he added.