Tesco is to more than double the number of grocery lines it sources centrally by February.

Speaking at a tour of Tesco's 12,000 sq m hypermarket in Prague, Philip J Clarke, CEO for the Czech Republic and Slovakia, said the move, which includes products for UK stores, could help bring prices down further on items like canned goods and confectionery.

Earlier this year, Tesco revealed it would be using group sourcing, where products for different markets are bought in a single transaction, for 500 of its grocery lines.

Clarke told The Grocer this week: "We started with 500 lines but it's no trial. We're doing it and by February next year we'll have 1,200 grocery lines sourced centrally. Group sourcing is also being introduced in February or March for hard lines. That's going to mean a lot of changes."

Clarke said sourcing grocery lines centrally would help with Tesco's aim to compete on price with the discount chains in the Czech Republic. All its formats in the country - hypermarket, compact hypermarket, supermarket and discount - offer the same prices on lines and aim to be the cheapest.

Tesco CEO for Turkey Steve Hamett said similar steps were being taken in Tesco's Turkish chain Kipa. "We're as cheap as it gets in this market. But 50% of food shopping still goes on in open markets so there's a lot still to shoot for."

Tesco made its ambitions in Europe clear when it opened a 44,000 sq m distribution centre near Prague this month. An extension is already planned.

A distribution centre will open in Turkey next year and Tesco plans to build nine more stores in the Czech Republic before February, including four hypermarkets, taking its total to 85 stores.

In Turkey Tesco will add three more hypermarkets to its existing 13 and four or five more Kipa Exspres stores to its existing ten. This growth will then accelerate next year.


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