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Next year, this 50-year-old knight of the realm, who grew up on a council estate in Liverpool, will celebrate 10 years at the helm.
As rivals clamour for the Competition Commission to put the brakes on Tesco’s increasing dominance in the British market, Leahy is plotting an ambitious international expansion that could keep the company growing at the vertiginous pace it has enjoyed since 1997.
He may not look superhuman. In fact he looks like an average bloke in a blue shirt rather than one of Britain’s most powerful businessmen. But since Leahy got the top job in 1997, 18 years after he first joined the company as a marketing executive in 1979, Tesco’s profits have tripled and it has become the nation’s biggest retailer.
Cut Leahy in two and you would probably find Tesco imprinted on his heart.
“Like most Tesco people, I think mainly about ... erm ... Tesco ... oh, and Christmas trade,” he said in a quip typical of his dry, understated humour.
“I think that most Tesco people have got their brains compartmentalised into two. One half is Tesco and the other is all the rest.”
His fanatical dedication to the business has already led to Tesco’s profits exceeding £2 billion. That has been achieved by strengthening its core food business, developing new store formats, expanding into non-food areas and pioneering services such as car insurance and bank accounts.
But if the company is to transform itself from a national champion into a truly global behemoth, it will need to get its international expansion right.
There is little doubt that this will be Leahy’s biggest challenge yet. Tesco has already begun to build an overseas presence in countries from South Korea to Hungary.
It has not been easy, and the roller-coaster journey it has had so far provides a taster for the challenges that lie ahead. In the past 12 months, a military coup has put the brakes on new store openings in Thailand, its trading in Hungary has been affected by the country’s economic crisis, and its South Korean business could have done without a panic over nuclear testing by the regime in Pyongyang. In India, Tesco wanted to go into partnership with Bharti Enterprises but earlier this month lost out to the American giant Wal-Mart. In Poland, it wanted to buy the operations of its Dutch rival Ahold but was beaten by France’s Carrefour. After those setbacks, speculation was rife that the wheels had come off the Tesco expansion train.
But just as the failure story was gaining traction, Tesco popped up last week with news that it had paid £180m to raise its stake in Hymall, the Chinese hypermarket chain, from 50% to 90% in a move that will enable it to accelerate its expansion in the Asian superpower.
By Leahy’s own admission, pursuing global growth has been a “huge gamble” for Tesco. New store networks have had to be created as well as new distribution centres.
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