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Tesco’s new discount chain to rival Aldi and Lidl could open within six weeks

According to the Guardian, workers at one Tesco store in Liverpool which is due to close have been promised potential jobs at a “new retail format” store opening in September

dave lewis in tesco store
The move is part of Dave Lewis' (L) plans to hit back against the discounters which have eaten into Tesco's market share in recent years

Tesco PLC (LON:TSCO) could launch its new discount chain as early as September, according to reports.

According to news reports over the weekend, the UK’s largest supermarket chain is set to open up to 60 "new retail format" stores as it looks to claw back some of the market share won by Aldi and Lidl in recent years.

The FTSE 100 group is recruiting for staff for three new shops in Lincolnshire, Cambridgeshire and London, while a medium-sized Tesco Metro in St Helens is set to reopen under a new name.

Online job ads for some of the sites state: “The new retail format will be operated separately from the core Tesco business and as such benefits offered will be different from those offered at Tesco.”

Workers at a Tesco Metro store in Liverpool which is due to close down have also been promised potential new jobs at a new store due to open in five weeks’ time, according to the Guardian.

Jack’s the lad?

Other reports on Monday suggested that Tesco’s new format stores could be called Jack’s, given that the firm recently tried to register the name as a retail trademark.

Commentators have warned that Tesco will have to tread a fine line with its new stores, being careful to distinguish them enough from the main brand while not going so far as to damage its reputation.

Traditional food retailers have been looking at ways to compete with the German discounters for some time.

J Sainsbury plc (LON:SBRY) partnered up with Danish chain Netto to launch a UK discounter back in 2014 but the venture closed down two years later as it struggled to turn a profit.

Tesco itself dipped its toe into the discount market back in the 1980s with the Victor Value brand but that was abandoned after just a few years amid concerns it was undermining the main brand.

Shares were down 0.2% to 268.2p in late afternoon trading.

Quick facts: Tesco PLC

Price: 243.2 GBX

LSE:TSCO
Market: LSE
Market Cap: £23.81 billion
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