Tesco bakery chief Gordon Gafa has revealed the retailer’s future plans for its in-store bakeries.
The plans, which Gafa discussed at the British Society of Baking’s Spring Conference late last month, consist of a three-pronged approach – simplification, innovation and collaboration.
“These are the three priorities that we are looking to arm our business with this year,” Gafa said, noting they come three years into a five-year turnaround plan for the business, which has already radically transformed its bakery offer.
This included significant investment in new product development, particularly speciality breads, new merchandising plans and a redesign. It also focused on customer engagement through activities such as sampling, increasing staff presence in bakeries and employing business-wide bakery coaches.
As a result, in-store bakery sales are up 4.1% like-for-like compared to a year ago. Total bakery value rose 1.8% over the 2017/18 financial year with volume up 2.6%. And, Tesco won Supermarket Bakery Business of the Year at British Baker’s Baking Industry Awards in 2017.
“Customers tell us we do overcomplicate their shopping trip and we could make it far easier,” he said of the first prong – simplification. “In in-store bakery, in particular, we need to be far simpler.
“Sometimes by lobbing in a lot of range you can stifle the faster sellers. By simplifying what we do, across Tesco, and in-store bakery is a priority.”
When asked by British Baker whether this would result in range rationalisation, Gafa said it would depend on what customers were looking for from an in-store bakery range.
“We’d been doing a lot of development that was maybe too much around flavour extensions and range extensions – not real innovation really. It just becomes more noise in the fixture,” he added.
Instead, Tesco’s focus will be on a handful of trends including bakery on-the-go as well as reducing salt and sugar. Tesco has already made some progress on this within bakery. For example, it rolled out a new recipe for its own-label doughnut lines to cut sugar.
Tesco will also focus more on collaboration. Part of the retailer’s big six KPIs is to build trusted partnerships, as well as how it works with customers and its colleagues. In short, how it collaborates with different parties across its business and supply chain.
“There is no way I am going to deliver my sales and profits metrics if I’m not collaborating with colleagues, wherever they may be, any suppliers and obviously truly understanding customers,” Gafa added.