Ironies

"You must be smug now that Tesco has announced some store closures"

So said a regular reader, after Tesco announced on January 28th that it was about to close 43 stores. After all, the reader continued, Tesco in Rhuthun/Ruthin has only been good for Tesco, not for the town itself. Wasn't Tesco's closure decision something akin to payback?

In spite of the views of some very early blog comments from what I assume to be Tesco employees, this blog was never anti-Tesco. Its original intent was to record the effect of Tesco on Rhuthun. Personally, I am indifferent to Tesco's choice to close. Their business decision to do so is no different from the late 1970s and 1980s when it divested of small town centre shops in favour of larger more out-of-town locations that at the time fitted its model. This Tesco did in Rhuthun, in the early 1980s, much to the chagrin of the town council of the time. This before the push towards buying into the convenience sector. And Tesco still has 3,257 stores to go, so it's not that Tesco is shrinking much.

It’s true, though, that recent events have knocked the shine off Tesco:

• The decision to close some stores
• The rise of the so-called discounters taking significant market share
• The fall out of the accounting scandal and
• The recent Panorama investigation into Tesco-supplier relationships…

… all mean that no longer will Tesco be the darling of consumers. Tesco will recover, it will repair its brand but in the eyes of the public, these days it's just another food retailer. No longer special. No longer will Tesco ever have it its own way. The City, though, will see things differently and already Tesco shares have increased by over 15 per cent at the news of closures.

Tesco once used its dominant position to open stores like crazy to drive out competition. This not just from peers such as Morrison’s but from town centres. In terms of Rhuthun, the only town centre convenience retailers left are:

• Castle Bell
• Chatwin's
• Popty'r Eryr
• Butchers John Jones and W & G Jones.

Leonardo's, Reebee's florists and Ruthin Whoolefoods are also convenience stores but of a far more specialist nature. Nevertheless, these represent but a small percentage of businesses in town.

Supermarkets have put paid to town centre convenience sector retail. A quarter of a century ago, two years before Lo-cost and 16 before Tesco, things were very different. The rot set in not under Tesco but Lo-cost, the 1992 store (now Co-op Station Road) that, just like Tesco 14 years later, was designed to regenerate Rhuthun. The irony.

• 25 years ago, we had five newsagents plus Trebor Hughes, a confectioner. We now have one newsagent in town and that has diversified into other lines and isn't strictly a pure newsagent any more. The shop No. 32 at the Machine began selling newspapers in 2014 but isn't a newsagent. Supermarkets are not wholly responsible for this sector's decline: newspaper circulation has steadily fallen over these years (even before the internet and iPad) and tobacco sales have fallen even more sharply.

Trebor Hughes ran a Welsh shop and confectioners where Elfair is now. He was a councillor. Till today, I hadn't linked the names (though pronounced differntly, of course). Another irony

• 25 years ago, we had four butchers in town. Only one of those four remains, joined by newcomer W & G Jones, a post Lo-cost shop.

• 25 years ago, we had five fruiterers/veg shops. They have all gone. Two others popped up but vanished almost as soon as they did so. An organic shop lasted longer but has also long gone. The last was post Lo-cost Reebee's that closed almost immediately Tesco opened. John Jones butchers is all that's left: they sell a small range of veg.

• 25 years ago, we had four general grocers. One was KwikSave, one Eagles Stores, another Warren's Happy Shopper and a fourth was the old small Co-op at the top of Well Street. All have closed. KwikSave became Somerfield but gave up. The Eagles Stores also carried on into the Tesco era but did the same. The old Co-op that used to stay open till the small hours of 8 p.m. closed almost at the same time as Lo-cost opened. Warren's similarly lasted only just into the Lo-cost era. We now have Lo-cost's successor Co-op and Tesco.

There is a simple accountancy phrase used in the retail business and it’s "cost to serve". Smaller shops have a higher cost to serve, whereas supermarkets and out-of-town retailers don't. With modern self-service tills as installed at Tesco's from new and the Co-op in 2014, the cost to serve decreases even further. Small convenience stores cannot compete and never will. Cost to serve is their weakness and Tesco's strength. You could open Rhuthun up to 24-hour free parking and it would make not a hapenny of difference to the number of convenience outlets or town shops in general. They simply cannot compete. Period.

The irony of the Tesco closure programme is the reaction from some community leaders UK-wide. Were these the same people who were no doubt concerned at Tesco's damaging presence in the first place?

Finally, I like this Daily Post comment from a Gwersyllt resident Sylvia Bagnall on the pending closure of Tesco's Gwersyllt store. It seems to sum up the mood and the background well. It's why Tesco is where it is. The site was a former longstanding KwikSave that became Somerfield in 2006 and upon closure in just 2011 was taken over by Tesco.

"I am quite surprised it's closing. It's only been open three or four years. But to be honest I only use it to buy bits and pieces. It can be a bit expensive and you don't generally see many people in it. But it does give that variety that other stores don't. Nearby Iceland just has the same stuff. It's a limited choice and I do also use Lidl. It's such a shame about the jobs going, but I do hope they replace it with another store so people can have more choice"

Did you spot the ironies? And what about "choice"? Not a word with which Tesco would like to identify outside the walls of its own stores.