Whats the future for Tesco Lotus?

[nong38]

I dont know if anyone caught the news that Tesco has sold its Koreon stores as it tries to get istelf back on the right track. What does that mean for Tesco Lotus here? In the same article it did mention that its stores in Thailand and Malaysia are not pulling up many trees, I think they got £4.2 for its Koreon operation it makes you wonder how much they would get for Tesco Lotus, the shops are rarely busy and who would buy them? Tesco dont seem to be in a very good position to sell and get a good price, it will interesting to see how this develops, they seem unable to arrest the slide of the brand in the UK and the Thai operation looks a pale shadow of that.

[Chivas]

Tesco Superstore I went to this morning in my home UK City clearly has no problem as packed out

[stoneyboy]

Given the number of new Tesco stores springing up everywhere in Thailand I can't see it having to much of problem in that department.

As for the UK it's far to established to be going anywhere soon.

It's like all industry or retail,there are highs and lows.

[scorecard]

Given the number of new Tesco stores springing up everywhere in Thailand I can't see it having to much of problem in that department.

As for the UK it's far to established to be going anywhere soon.

It's like all industry or retail,there are highs and lows.

A few months back an industry paper mentioned that the future of such stores is in the Lotus Tesco Express type / size of stores, not giant supermarkets.

A few weeks back I was doing MBA lectures in Vietnam, one of my students mentioned that his company (local, has many small shops similar to Tesco Express / 7/11 type stores) had just finished a new design for the roll out of several hundred stores across Vietnam, they have avoided giant stores because they believe that configuration is no longer successful. All of their new stores will be about the size of the biggest 7/11 stores in Thailand but they will have a bigger variety store by store compared with the typical C stores in Thailand and Japan.

[topt]

Write up here for reasons behind the sale but no mention of the Thai business - http://www.bbc.com/news/business-34171937

More interesting one here mentioning other divestments and the Eastern European businesses- http://www.thisismoney.co.uk/money/markets/article-3225473/Tesco-s-Korean-sell-Supermarket-checks-foreign-deal.html

Then 3 days ago a comment here about their other Asian businesses and a comment about an approach to buy the Thai business- http://www.thisismoney.co.uk/money/news/article-3232037/Tesco-s-remaining-Asian-business-block-sale-Korean-chain-week.html

[i claudius]

Tesco here in Pattaya is a waste of space,they are always out of everything as far as I can see its just poor management and ordering anything populR is out of stock half the time

[stoneyboy]

Tesco here in Pattaya is a waste of space,they are always out of everything as far as I can see its just poor management and ordering anything populR is out of stock half the time

A company is only as good as its staff,something which is a big problem here I'm afraid.

[SantiSuk]

http://www.thisismoney.co.uk/money/markets/article-3225473/Tesco-s-Korean-sell-Supermarket-checks-foreign-deal.html

One take on an answer to your question.

In summary

1. expect further foreign sell-offs
2. Their Thai jv is not specifically mentioned as being on the blocks
3. Would probably take good offers for almost anything foreign

[Rogergreybeard]

Yes your right about staff absolutely no idea ask questions and typically run away, it's not stock problem you can't train people who don't want or can't speak even basic English, everyone raves about Asian, wait and see the lost Los

[maoro2013]

The stock problem is more likely a head office or logistics problem. If you had anything to do with FMCG you would know that the inventory is mostly controlled by computer.

[recycler]

The Thai retail market is very profitable as it is rigged to avoid competition in prices. Margins are beyond belief compared to the cut-throat competition between supermarkets in Europe. CP would be very eager to buy Lotus, the price they paid for Makro was something the former Dutch owner SHV could only have dreamed of.

[whatproblem]

I was told by a manager of one the store that they cannot order items ,they said that they have to wait for what they get sent ,I didn't believe it but 8 months later they had the items I was after ,unbelievable

[recom273]

I don't have an issue with the Lotus superstores, we have two here, I go out of my way to buy specific imported items, sometimes theres no stock, but I return.

BUT .. The 'express stores here are just plain disgusting. The floors are dirty, there are pallets of coke and water piled high out-front. There are always queues, the staff seem badly trained and can't be bothered. The whole place resembles a Sunday morning boot fair.

I went in the other day, there is a bowl of half eaten mama on the side. They seem to be have constant deliveries, and the stacks of plastic boxes seem to block the aisles.

It's not just my local, it's every one I visit .. to the point where I will continue riding and find a 7-11, where inevitably i will spend another 20-50B on junk food that lotus doesnt sell.

[lopburi3]

The stock problem seems to be more than computers - I have almost never received a complete home delivery order - and items out of stock are often those on promotion (so one would expect them to be in stock). I am a frequent user from when they started the service and in general am happy with it; and there staff often try to make reasonable substitutions so do not believe the issue is just Lotus staff. Suspect the real issue is supply chain is just not reliable enough for current low stock/computer order model used in modern world .

But two weeks ago I ordered an item from Lazada where supplier was Lotus and did not receive anything beyond shipment being prepared - this week get notice Lotus can not provide in the expected one week delivery window and order canceled (thanks Lazada for at least taking some action so I can buy elsewhere). They should not have advertised it on Lazada as available if it was not. Computers require current input.

[thhMan]

Thailand is just lazy, thats why things break down, aisles full of staff yakking

Ask them anything, even in Thai and they just point.... over there ....

[asdecas]

Corporate word is that Tesco Lotus in TH is not affected. Whether you believe that or not is of course up to you.

[blacknight]

I read somewhere recently that the Thai billionaire who used to own the Lotus part of the partenrship was interested in buying out Tesco should they ever need or wish to sell.

[recom273]

Yes your right about staff absolutely no idea ask questions and typically run away, it's not stock problem you can't train people who don't want or can't speak even basic English, everyone raves about Asian, wait and see the lost Los

I conduct language training for a big American multi-national company here.

I guess it's an expensive investment but all the employees are long term, who earn decent money - I was surprised to find not all have finished uni, but, since day one, I have been blown away.

Everyone in the company has a certain confidence, from the security guards in the carpark to the management, even if they aren't taking a course, they will greet you and ask a sincere 'hows it going?'. Its not always about having the vocabulary to communicate, but having the confidence to do an effective job.

It's all down to priorities and investment, I guess.

[ThaiKneeTim]

Other supermarket chains in the UK are suffering, Morrissons recently closed 11 stores, and are pulling out of the express sized stores altogether.

It suits Tesco to keep their Thai operation as they buy lots of supplies for their UK operation from Thailand. The profit they make in their Lotus stores pays for the goods shipped to the UK thereby avoiding currency exchange issues.

Tesco biggest failure was trying to gain a stronghold in America (again) with their Fresh and Easy brand, but Walmart can afford to undercut them for as long as it takes to freeze them out.

I imagine the Korean operation was sold to raise money to pay shareholders dividends, just as the six corporate jets were.

[ThaiKneeTim]

I was told by a manager of one the store that they cannot order items ,they said that they have to wait for what they get sent ,I didn't believe it but 8 months later they had the items I was after ,unbelievable

It's true actually, at least with the UK stores. I'm currently working in the Tesco fresh and frozen distribution centre in South West England, the stores are often sent stock they have no chance of shifting, and don't stock items they could sell. Sometimes it makes absolutely no sense whatsoever!

[Toscano]

Scorecard has a point that the smaller Tesco-Lotus Express spread widely across the country may be more profitable than the big out of town Tesco stores . Clothes , televisions , furnishings etc. take up a lot of space , employ many people , but do not have the brisk trade of the food department . Management is a very important feature , some larger stores are not very well managed .

We have a well managed Tesco-Lotus foodstore at Kranuan and a well managed Tesco-Lotus Extra nearby . Thailand small towns and bigger villages have no proper food shopping stores that include meat , vegetables and dairy produce .

[flyingdoc]

Tesco Lotus is here to stay !

[Toscano]

I read somewhere recently that the Thai billionaire who used to own the Lotus part of the partenrship was interested in buying out Tesco should they ever need or wish to sell.

LOL !!! Thaksin Shinawatra ?

[blacknight]

I read somewhere recently that the Thai billionaire who used to own the Lotus part of the partenrship was interested in buying out Tesco should they ever need or wish to sell.

LOL !!! Thaksin Shinawatra ?

No CP group actually

[northernphil]

I don't have an issue with the Lotus superstores, we have two here, I go out of my way to buy specific imported items, sometimes theres no stock, but I return.

BUT .. The 'express stores here are just plain disgusting. The floors are dirty, there are pallets of coke and water piled high out-front. There are always queues, the staff seem badly trained and can't be bothered. The whole place resembles a Sunday morning boot fair.

I went in the other day, there is a bowl of half eaten mama on the side. They seem to be have constant deliveries, and the stacks of plastic boxes seem to block the aisles.

It's not just my local, it's every one I visit .. to the point where I will continue riding and find a 7-11, where inevitably i will spend another 20-50B on junk food that lotus doesnt sell.

Totally agree. I only know of one Lotus Express between MaeChan and the northern border, Every week I am in the town and I see pallets pilled up on the pavement outside , always soft drinks standing in the sun. I went inside a couple of weeks ago to buy some smokes and there were 5 people at the check out .Lunch time and one on the till who had gone to look for something. Hopeless, ah but it is open 24/7.

[thailanddogerator]

They are leader in Thailand they won't give up.

Carrefour left because it is a too small market and they were not leader.

[mikebell]

Tesco here in Pattaya is a waste of space,they are always out of everything as far as I can see its just poor management and ordering anything populR is out of stock half the time their customers with disdain by causing long queues at the few check-outs open. They would do well to observe the way MAKRO treats its customers.

[maidee]

i'm sure if they want to pull out, then CP can take them over to sell their high quality sausage (lips & asses) meat and rebrand it in giant 7/11

[mike324]

Thailand is one of their most profitable markets, so they will not pull out. In South Korea E-Mart has been the dominant player and its hard to topped them especially with their online store service as well. Since they are a late comer, its harder to expand in Korea due to the high rental cost and limited space.

[Jeffkp]

I've noticed the stocking issues at Rimping as well. It's obvious there's no 21st century supply chain in place. I've noticed that the staff don't seem to know what products they have on the shelf's. I can't speak for other countries, but the US now have computerized inventory systems and "just in time" delivery of product.

At Rimping, I constantly see staff on the floor doing hand written inventories; but why does it take weeks sometimes for common products to be restocked ( like coke!)

Back in the late '90's a friend of mine who was originally from Iran brought his parents to visit him in Atlanta. His father was was a very wealthy businessman, but had not traveled to the west. He took his father to Home Depot, a huge warehouse of all things construction and home improvement. His father was shocked beyond words. He spent 4 hours in the store and insisted on returning 4 more times during his visit.

I think the point is that we've become spoiled by the market efficiency in the west and expect the same in Thailand.