Incoming Tesco chief executive Dave Lewis must tackle the same legacy problems as his predecessor failed to do, including product, pricing and increased competition, industry insiders have warned.
Lewis, who heads up Unilever’s personal care business having joined the consumer goods group fresh out of university in 1987, will join on October 1. Philip Clarke was ousted this week (Monday 21) following a profit warning, which said the first-half performance to the end of August will come in “somewhat below expectations”.
Tesco is due to publish these figures the day Lewis joins. Clarke will leave the same day, but will remain available to support Tesco until January.
Many in the industry said legacy issues – such as product and pricing, intensifying competition and the hangover from its loss-making US business Fresh & Wild – could still challenge the new boss if not quickly addressed.
A supplier for Tesco clothing arm F&F said Lewis’s lack of retail experience was not an issue, but added: “What concerns me is that he’ll be too removed to make things happen. The biggest challenge is to make Tesco less process-driven.”
“When Clarke took over there were all kinds of legacy problems,” agreed Phil Dorrell, director of consultancy Retail Remedy. “Those are still there; it’s time to see whether Lewis can solve them.”
HSBC analyst Dave McCarthy added: “The choice of Dave Lewis may appear surprising. He has had a successful career and is highly respected, but he is not a retailer.”
F&F chief executive Jason Tarry said it was “business as usual”.