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Tesco pinning hopes on local businesses to improve flagging sales

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Tesco will offer in-store exhibition space to local businesses across its entire Extra and Superstore estate as it aims to reverse declining sales in larger stores.

The short-term displays will be created in Tesco’s 249 extra and 482 superstores in the UK and will offer products and services that look to improve the shopping experience for customers. The first business is expected to launch in the next 10 days.

Local car dealerships and home improvement firms are all believed to be interested while franchise gym operator Bannatynes Health Club will open at least one exhibition space. But finance and telecommunication firms will be exempt from pitching up as Tesco already has its own mobile offer as well as commercial partnerships with Virgin Media and others.

It is understood there will be no more than two concessions available in each store.

In a speech to the Federation of Small Businesses earlier this year, Prime Minister David Cameron said small businesses will be “particularly important” to the UK economy as it recovers from the recession. “We will be a stronger economy after we’ve been through this difficult period and small business is going to play a vital role,” he said.

Dr Tim Denison, director of retail intelligence at Ipsos retail performance said: “Tesco’s move is picking up on the importance being given to small businesses in the political arena.

“When price has become the key battle ground among supermarkets at present, this is another way to differentiate the retailer and build brand value around the core offer.”

Tesco has previously helped schools through its computers for free vouchers programme and this is another concept looking to reach out to the broader community. The model is in some respects similar to Waitrose’s community donation scheme which has run since 2008.

A Tesco spokesperson said: “Working with local businesses like this helps us make a wider range of services available for our customers.”

Promotional Space boss Ian Silverton, who was selected by Tesco as marketing partners for the concept, said: “Our concession business contacts will welcome the opportunity to promote their services within Tesco and this arrangement gives us the reach to offer alternative venues in almost every town in the UK.”

Published on Friday 20 June by Editorial Assistant
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