Tesco CEO on Amazon: 'We see them as a formidable competitor'

LONDON — The CEO of Tesco says the supermarket chain sees Amazon as a “formidable competitor” but emphasised that Tesco is in a “good place” to compete with the online retail giant.

Share prices of supermarkets worldwide slumped in June after Amazon announced it was acquiring US grocer Whole Foods.

The deal represents a major expansion of Amazon’s ambitions in the food and drink sector, and there have been rumours that the e-commerce giant could pursue a similar deal in Europe.

“We have to respect Amazon,” Tesco CEO Dave Lewis said at a press conference in London this week. “We see them as a formidable competitor.

“But delivering food and handling food is very different to delivering non-food. If we as Tesco play to the strengths that we have in terms of the stores we have and the delivery capability we have, then actually we can deliver a great service for customers that is very difficult to compete with.”

Lewis highlighted the fact that Tesco leads Amazon in the UK grocery home delivery market in London, where Amazon operates its Fresh delivery service, and said that the Whole Foods deal shows Amazon is “trying to buy things that we as Tesco already have.”

“Competition makes you stronger,” Lewis said. “We should just be mindful as to what it is Amazon are doing, look at the strengths of what it is they ultimately bring to the market, and ask ourselves as Tesco: how do we do better? Just don’t give up where we start from — we start from a very good place.”

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