Warren Buffet admitted he made a big mistake in taking a 5% stake in Tesco a couple of years ago. he's not the only one, I have my own grief in not recognizing that Phillip Clarke was losing his way. I should have seen it, a boy who loaded shelves now running one of the worlds biggest retailers, just not right. The dividends blinded me to be honest, regular 5% every year like clockwork.
The collapse of Tesco made me decide to stop doing this blog. But after Warren Buffet's admission I feel a bit better, the Sage of Omaha blindsided makes my error look less stupid. I shop at Tesco and so do millions of others. The loss of £250m profit was on a profit for the year of £1.1bn so I think the market has over reacted, more looking at "what else is wrong" than the figures themselves.
Morrison to my surprise has responded in just the right way. Recognizing that Aldi and Lidl are a real threat and bringing them into its price match is a wonderful and clever move and I say so because Lidl and Aldi are not cheap but only careful in what they offer at low prices. Morrisons have obviously decided rather than let shoppers drift away to this unknown low price, lets meet it head on and show customer we are better. Bravo Morrisons.
My worry is that I am not that clear the new CEO at Tesco is up to it either. It should have been Tesco who came out with this move. The other thing that worries me is that a newspaper report said the new CEO intends to send the 5000+ workers at HO back to the shops. What he should do is cut the 5000 down to 1500!