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New Tesco boss starts long journey

London - Retail is detail, the industry adage goes, and new Tesco boss Dave Lewis will be hoping investors and shoppers agree after he unveiled a flurry of small tweaks to Britain's ailing No.1 grocer, but not the big rescue plan many think it needs.

Only seven weeks into the job, and in the midst of an accounting scandal that forced him to scrap the company's full-year profit forecast, Lewis was never likely to commit himself to a costly revival plan that he didn't know if he could afford.

But with Tesco's sales falling at their fastest rate in living memory, its shares plumbing 11-year lows, and the all-important Christmas trading season fast approaching, he had to do something to try to stop the rot.

So the former Unilever executive has looked round his new industry and identified some small, inexpensive changes, such as simplifying product ranges in an effort to match the straight-forward shopping experience offered by popular discounters.

Lewis said Tesco's 1 000 most in-demands lines would be given more store space to improve their availability as part of a broader - though largely unquantified - commitment to improving customer service.

The number of staff on shop floors would also increase between now and Christmas, including head office staff working shifts, he said. That would equate to an extra 2 million hours worked by shop staff between now and the end of the year, he added, without saying how many extra workers would be taken on.

The 49-year-old also saw plenty of scope for savings. Having put Tesco's corporate jets up for sale in his first week in the job, Lewis said the company didn't need all 32 of its UK offices. It could simplify the top of the organisation, possibly code for management job cuts, while its different store formats could work together to use their buying power more effectively.

The cost cutting would also affect him personally, with Lewis -- who has a basic salary of £1.25m ($2m) a year -- saying he was making his business trips into London from Tesco's headquarters north of the capital by train.

Despite the lack of precise figures, some analysts were sympathetic.

"There are plenty of financial issues that he has to address but I think his reading of the situation is quite sound ... He is very good at setting out his view on customer service ... I think he is on the right track," said Cantor Fitzgerald's Mike Dennis, who does not have a rating on Tesco shares.

But what Lewis did not announce a strategy for is arguably what is closest to most Tesco customers' hearts: price.

While some shoppers in Hackney, east London, where Tesco was founded in 1919, have stuck with their local stores, others have moved instead to nearby discount grocer Lidl - a trend seen across Britain.

"This is cheaper," said Maureen Walker, 82, at a branch of the German-owned discounter. "I come here once a week," she said, adding she used to shop in Tesco and rival Sainsbury's .

Lewis did not rule out launching the price war that many analysts think will be the only way to restore Tesco's fortunes.

"Price is something I have under review...," he said. "(But) until I've got the service right and I've got the availability right, investment in price, if I were to change it, wouldn't have the impact that I would want," he said.


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