Forget supermarket price wars, Tesco just needs to improve its image
Shares in the retail giant climbed 1.8pc on Friday morning, making it one of the top risers in the FTSE 100, after analysts at Nomura said it may not need to cut its prices to increase sales.
The retail giant has come under pressure to slash prices after three years of declining sales, as it loses out to discounters Lidl and Aldi.
But Nomura analysts said Tesco's real problem is its image, which can be fixed without needing to erode margins by lowering prices.
They said the retailer's Everyday Value range is already similarly priced to economy lines at Tesco's closest rivals.
So instead, they suggested moving the value range upwards in price and quality to distinguish Tesco from the pack.
Investors will hope that Tesco's new boss David Lewis, who will undertake a root-and-branch review of Britain's biggest retailer when he joins in October, will take heed.
Mr Lewis will replace Philip Clarke, who resigned from the retailer after it issued its latest profit warning last month.
source: telegraph.co.uk
