Tesco CEO Dave Lewis warns on October Brexit

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// Tesco CEO warns on fresh food supplies should a no-deal Brexit take place in October
// Due to proximity to peak trading period, Tesco will not be able to stockpile in same way
// On Tesco turnaround Dave Lewis affirms: “We haven’t finished what we started.”

Tesco chief executive Dave Lewis yesterday warned a Brexit taking place in October would be far more difficult to handle than the preparations the supermarket giant put in place in March.

Britain had been due to leave the European Union on March 29, but after Prime Minister Theresa May was unable to get her deal ratified by Parliament the date is now set for October 31.

The new date falls just before peak trading season for retailers.

Lewis told shareholders at Tesco’s annual general meeting on Thursday that it would not be able to prepare in the same way for a Brexit taking place in October and November.

“For us to be able to do what we did in March in October will be more difficult because we won’t have the space in our logistics system to be able to cope because we’ll be preparing for Christmas and the seasonal peaks that are there,” Lewis told the annual shareholders’ meeting at Tesco’s headquarters. 

Tesco had originally stockpiled over £200 million worth of long-life food products for the end of March to help it cope with any disruptions in the supply chain.

The retailer sold the stock after Brexit was delayed, and now has no additional stock remaining. 

Lewis pointed out that sourcing fresh food will be a major issue if there is a disorderly no-deal Brexit, as Tesco imports about 50 per cent of the fresh food it sells. 

“The question is – is there a delay at the border, is there a tariff (to pay)? That’s where the biggest sensitivity for our industry will be,” said Lewis.

His comments came after Tesco on Thursday posted a 0.2 per cent rise in its first quarter like-for-like sales to £13.9 billion despite “subdued” trading across the market.

Tesco is currently in the midst of a long-term turnaround strategy, with Lewis cutting an estimated 10,000 jobs from the company since he took the helm in 2014.

Having spent nearly five years in the top spot at the supermarket, Lewis denied suggestions that he may be looking to move on from the retailer now his turnaround was in place.

“I’m aware of all the chatter,” Lewis told reporters after Tesco published a first quarter trading update before its annual shareholders’ meeting.

“I’m focused on Tesco, very happy with the team, the business. We haven’t finished what we started,” he said.

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