Global retailer TESCO to source more from Sri Lanka

Thursday, 6 December 2012 01:13 - - {{hitsCtrl.values.hits}}

Several Sri Lankan export sectors have suddenly received an unexpected Christmas gift from London.

TESCO, the world’s third largest retailer and UK’s biggest supermarket chain, is preparing to significantly expand its sourcing from Sri Lanka, buoyed by the well-focused facilitation of the recently-established Consultative Committee on Market Diversification (CCMD).

“We warmly welcome TESCO to Sri Lanka and commend for expanding its buying interest from us beyond the current levels. We believe TESCO can be a strong partner in our exports expansion. I commend CCMD for its prompt success,” said Minister of Industry and Commerce Rishad Bathiudeen yesterday, upon learning of TESCO’s entry.

TESCO PLC, with US$ 94 b revenue (2011), is the world’s third largest listed retailer with 6,300 stores and 500,000 employees across 14 countries, and is also the UK’s largest supermarket chain commanding more than 30% of the British market share.

“We are not here to source Sri Lankan apparels or food products, of which we are well-established already with $ 100 m annual purchases. Now we want to go for other Sri Lankan products as well,” revealed Mark Kenneth Astley, Haryana-based General Manager of Tesco Hardlines, Gurgaon (under Tesco International Sourcing, Hong Kong), yesterday at the Ministry of Industry and Commerce, Colombo.

Astley is in Colombo with Amit Lal, his Manager, for special direct one-to-one meetings with keen Sri Lankan exporters, arranged by the CCMD, the new unit recently established to battle the global market downturn and secure new export destinations for Sri Lanka exports.

The cross functional unit CCMD is now reporting its first high level win with TESCO’s entry –in less than a month since its commencement on 16 November. CCMD is driven by the Department of Commerce and is chaired by the Secretary of the Ministry of Industry and Commerce. It is also learnt that Sonali Wijeratne, the Department of Commerce’s Minister (Commercial) based in London, has been commendably instrumental in securing TESCO’s latest entry to Sri Lanka.

“We believe that Sri Lanka can add colour to TESCO’s product profile by exploiting our diverse basket,” said Ministry of Industry and Commerce Secretary Anura Siriwardene addressing Astley. “The Ministry of Industry and Commerce and the Department of Commerce assure you the maximum support in this process,” he stressed.

“We are keen on expanding the Sri Lankan product profile displayed on the shelves of over 6,300 TESCO stores across the world, over 2,900 of which are in UK. At present, we are thinking of additional GBP £15 to 20 m ($ 32 m) product sourcing from Sri Lanka. Previously, our growth came from UK. But now we see new growth coming from the East – S. Korea, Thailand, Malaysia, China, etc. – as our stores in these markets report more sales. Therefore we need to source more products and Sri Lanka is one South Asian country we are now closely studying among 33 new sourcing destinations. In other words, TESCO can be a viable and a promising platform for Sri Lanka’s export market diversification, especially to the east,” Astley revealed, and cautioned: “But please understand that with more than 6,300 stores across the world, TESCO can be a demanding customer in terms of quality and quantity.”