Is the rise of Tesco such a terrible thing?
Fears abound that the British high street is being flattened by the Tesco juggernaut.
Tesco’s profits in Britain are up by 24.2 per cent this year, and the company now has the highest market share – 28 per cent – ever enjoyed by a supermarket. Stalwart high street stores are dwindling. Sainsbury’s has slipped into third place, behind Tesco and Asda, taking only 17 per cent of market share (1). WH Smith, Boots, Marks & Spencer and Woolworths are suffering similar fates. Marks & Spencer’s misfortunes have become a regular news item; WH Smith this week announced losses of more than £100million, the worst set of figures in its 200-year history.
Then there is the death of all the independent butchers, bakers and candlestick makers. A recent survey found a 59 per cent drop in the numbers of greengrocers between 1992 and 2002, and a 40 per cent drop in butchers (2). The New Economics Foundation reports that wholesalers are closing at a rate of approximately six per week, and specialist stores are closing at a rate of 50 per week (3).
Critics label Tesco a marauding beast, ‘gobbling up’ the market, putting suppliers in a ‘stranglehold’ (or alternatively, ‘armlock’), ‘manipulating’ consumers, and engaging in ‘unfair’ trading. The superstore is also blamed for wrecking communities and leaving empty streets full of derelict shops.
But the fact is that Tesco has got rich by working out new and better ways of selling people food (and just about everything else). More than 13 million customers shop at Tesco every week. They don’t do this because they are brainwashed, or because they can’t find a decent local butcher. Tesco pioneered internet shopping, making it possible to order goods at any time of the day or night, and have them delivered direct to your door. It went for big, out-of-town stores selling everything including the kitchen sink, and also invested in local ‘express’ stores. It slashed the prices on everyday goods, and also developed new lines catering for the quality market.
Sainsbury’s, by contrast, has dragged its feet, following in Tesco’s wake on internet shopping and local stores, and failing to cut prices to the same degree. It also blew millions on IT systems and automated depots that didn’t work.
Tesco is only being bashed because it happens to be top dog at the moment. Behind the attacks lies a general suspicion of big business and mass production, and a harking back to the small producer labouring away in his fields.
Guardian columnist and green activist George Monbiot warns that the supermarkets ‘[have] destroyed the livelihood of tens of millions of small proprietors and their employees’. Consumer affairs writer Felicity Lawrence complains of a ‘creeping takeover’ of the food industry, saying that this has meant that ‘British farmers have been driven out of business or pushed to the margins of survival’ and that ‘the disadvantaged are denied affordable access to good fresh food’ (4). The New Economics Foundation warns that supermarkets have ‘too much power’, and the Soil Association accuses supermarkets of running a ‘fear chain’ rather than a food chain.
Some scrape the bottom of the barrel right out to show up the big supermarkets. Lawrence says that customers ‘feel excluded’ from the bulk bargain deals if they can’t afford them, and also complains that supermarkets are difficult to navigate: ‘for the elderly, the sheer physical distances in walking through huge hyperstores is too daunting.’ Others slip into a barely veiled contempt for consumers, who are apparently too lazy to traipse around the high street, and so greedy that they always go for bargains. ‘Shunning the high street grocer will trash your community’, lectures one commentator (5).
In fact, supermarkets have done quite a lot for Britain. In the misty age of ‘local independent retailers’, women spent whole afternoons lugging their bags from shop to shop. Supermarkets turned a daily ordeal into an hour-long Saturday chore. They made production, supply and retailing much more efficient, and chopped prices on the daily necessities – turning milk, meat and eggs into daily fare for British families.
Of course, supermarkets were only ever motivated by the bottom line. But they arguably ended up doing as much for national living standards as did the charitably inclined welfare state. Not to mention the hand-up they gave to the quality of the British diet. Britain was once the nation of a notoriously dowdy pallet – stodgy pies, marmite, and spaghetti on toast. Olive oil was only available in pharmacies, for curing earache. Now supermarket shelves groan under Mexican tacos, Japanese miso soup powder and Italian pasta.
Today Tesco and Sainsbury’s local stores are helping to bring up some down-at-heel neighbourhoods. A new Sainsbury’s has just opened up in my area of Hackney, meaning that it’s now possible to buy fresh meat on the high street. Women leave with two chickens for £2.99 each, enough to feed even the biggest family. Clapton’s residents don’t seem too resentful of this corporate intrusion. Twenty-year-old Barbara told me that she came for the ‘quality food’; Ozgur, 26, for ‘fresh donuts’; JP, 33, because it was ‘more reliable’.
The lament for the loss of the small business is as old as capitalism. Capitalist development tends to increase the productivity of labour and concentrate business in fewer hands, which puts independent producers out of a job. Independent hand-weavers were replaced by factories’ machine looms, and small family businesses were replaced by big corporations. This has meant a greater variety of cheaper goods – and a reduction of drudgery, freeing people up to do something more interesting with their lives.
Critics worry that supermarkets employ fewer people than corresponding small businesses. The New Economics Foundation has calculated that £50,000 spent in local stores creates one job, while it takes £250,000 to do the same in a supermarket. According to another set of statistics, 276 jobs are lost every time a large supermarket opens. George Monbiot moans that there used to be 50 bakeries in his part of Oxford, and now there is one. But these shifts are no bad thing, if there are other jobs for people to do instead. The sons and grandsons of Oxford bakers might now be academics, or even journalists like George.
This process also has its downside, such as low wages for supermarket workers, and unemployment and dereliction in some areas. But these problems are best dealt with on their own terms – fighting for better wages, creating new industries, and finding new tenants for ex-bakeries. Going backwards to Ye Olde England is not an option.
Yet supermarkets seem keen to take on the concerns of their critics, and to pose as local and community-centred. Safeway (now taken over by Morrisons) modelled some of its shops on a high street layout. Instead of uniform rows of shelves, different goods were presented in separate stands – with a circle of fruit and veg over here, coffee counters and hairdressers over there. It’s like visiting the café, greengrocers and butchers, only all under one roof. Sainsbury’s tries to give its small stores a community feel, with a bubble-lettered ‘hello’ welcoming you at the door.
Meanwhile, Tesco emphasises its support for ‘local farmers wherever possible’, and has developed a new ‘Locally grown’ range of products. Sainsbury’s joined a campaign by Prince Charles to save small businesses in the countryside. And Asda tried to play a role in the community, introducing a ban on eggs being sold to young people in an area where they were being used for unsavoury pursuits (6).
But supermarkets look ridiculous trying to pose as local stores. The local butcher giving young troublemakers a telling off is one thing. When Asda tries to do it, it just doesn’t work. Plus supermarkets are laying themselves open to critics who start calculating how much local produce they really do use. Supermarkets might be better off doing what they do best – sell a large variety of goods as cheaply as possible.
There will always be a niche for the quality butchers, the specialist bakers or delicatessen, which reach the parts that supermarkets can’t. Indeed, luxury farmers’ markets, such as Borough market in London, have boomed along with Tesco, packing out most weekends.
One independent butcher in Farringdon said that only those shops with ‘quality and expertise’ had survived. ‘Most local butchers were rubbish. They were in it for the money just as much as supermarkets were. The competition has sorted out the men from the boys.’ A Sainsbury’s was opening opposite, but he didn’t see it as a threat. ‘It will bring people to the area. They’ll go to Sainsbury’s, then come here for their meat.’
A chef at a luxury food hall said that people come there for things they can’t get elsewhere. Certainly, it wasn’t mass-market stuff – £11.60 for a rib-eye steak from Aberdeenshire; £5.55 for two small Cornish oak-smoked trout fillets. Independent producers work well for something special, or when you’ve got some time to wander around at the weekend – leaving supermarkets to bear the brunt of the everyday fare.
There should be no eulogies for the grubby local butcher, or for traditional high-street stores such as M&S or Woolworths. If they can’t take the heat, they should get out of the kitchen.
Supermarkets are – super, by Jennie Bristow
(1) Where the tills keep on ringing, James Robinson, Observer, 26 September 2004
(2) Alternative high street, Evening Standard, 4 August 2004
(3) Ghost town Britain crisis hidden by Christmas glitz, new economics foundation, 15 December 2003
(4) The myth of choice, Felicity Lawrence, Guardian, 15 June 2004
(5) The price isn’t right, Rachel Shabi, Guardian, 26 January 2004
(6) Halloween egg sale ban for youths, BBC News, 17 October 2004
To enquire about republishing spiked’s content, a right to reply or to request a correction, please contact the managing editor, Viv Regan.