TESCO chief executive Philip Clarke is expected to take the reins at the retailer’s UK business for at least a year until sales show signs of improving, after former head Richard Brasher abruptly stepped down.
Tesco announced yesterday that Brasher was stepping down from the board of Britain’s biggest retailer with immediate effect, and would leave in July after 26 years at the firm.
The move follows Tesco’s first profit warning in 20 years due to dire trading at Christmas, admitting that underlying profit in 2012 would be £450m lower than expected.
Clarke yesterday insisted he had not rowed with Brasher, who was responsible for the “Big Price Drop” campaign, which has been criticised for failing to lure customers to its stores at Christmas. Clarke told reporters: “You can’t have two captains in a team.”
However, sources close to the company believe the pair clashed over the strategy for the business with Brasher arguing for faster and bigger price cuts to boost the performance of the “Big Price Drop” campaign.
Analysts told City A.M they expect Clarke to appoint a new UK head “as soon as like-for-like sales improve” voicing concern over Clarke taking charge for both the UK and overseas business in the long term.
Analyst Clive Black at Shore Capital said Brasher’s departure was “a clear grasp from the top that the core chain has to improve.”