Tesco is closing its Jack’s discount chain, created to win back shoppers from Aldi and Lidl, less than four years after it was launched.
Britain’s biggest grocer opened the first Jack’s stores – named after the supermarket’s founder, Jack Cohen – in September 2018, in Chatteris in Cambridgeshire and Immingham in Lincolnshire, with a promise to be “the cheapest in town”.
It had ambitious expansion plans for the chain, and had initially set out to open between 10 and 15 stores in the first six months after launch.
But Tesco ultimately opened just 13 Jack’s stores. Six of the branches will be converted into Tesco superstores, while the remaining seven will be shut permanently.
About 130 jobs are to go at the closing stores and at the retailer’s head office, although Tesco said it would try to find alternative roles for the staff affected.
Jack’s employees at the shops being converted will automatically be offered new in-store roles, while Tesco said it would also be recruiting extra staff for the new superstores.
Tesco insisted the Jack’s venture had helped it to win over new customers from its competitors.
Jason Tarry, the chief executive of Tesco UK and Ireland, said: “We have learnt a huge amount from Jack’s and this has helped Tesco become more competitive, more efficient and strengthened our value proposition, including through the launch of Aldi price match.”
Jack’s was created during the tenure of Tesco’s former chief executive, Dave Lewis, and launched in the company’s centenary year. The retailer claimed it had spotted a gap in the market for shoppers who wanted “smaller, simpler” stores that sold more British produce.
To keep costs down, Jack’s stores followed a similar layout to stores run by the German discounters, with products stacked on pallets on the floor rather than on shelves, while they also promised discounted homewares.
Almost three-quarters (70%) of the products sold in the stores were branded as Jack’s, while the branches stocked a greatly reduced range, with about 10% of the items found in a typical large Tesco supermarket.
Jack’s branded products will remain available at independent convenience stores that are supplied by wholesaler Booker, which is now owned by Tesco.
After a review of the meat, fish and hot deli counters in its stores, Tesco said it was closing those counters at 317 shops where there was the least demand. The employees working on the counters will be offered alternative roles.
In January, Tesco was revealed as one of the winners of the most recent Christmas trading battle, according to analysis by data firm Kantar, increasing its market share to almost 28% during the festive period.