For a company which invests so much on branding and advertising, Tesco are surprisingly shy when it comes to announcing their intention to open up convenience stores in a new area. Anarchaeologist examines their expansionist plans for dublin and looks at some of the real costs.
In fact ‘shy’ doesn’t do justice to the extent to which the UK multinational will disguise its plans for expansion from the public, and indeed any planning authority that adjudicates the planning application. Most applications for Tesco convenience stores lodged in Dublin over the past few years have been for ‘change of use’, or other such innocuous expressions designed to obfuscate and confuse. Their most recent application for a store in Smithfield came in under that guise. A huge, open, seventeenth-century marketplace just north of the Liffey – known mostly for its monthly horse fair – Smithfield has been redeveloped over the past 10 years by what effectively has been a public-private partnership between the City Council and a consortium comprising the Kelly and Linders families.
Designated a new cultural hub for the city under the DCC HARP scheme, the redevelopment has not been successful in terms of its promised cultural dividend. The Lighthouse Cinema has now closed and the open air concerts held in the ‘Plaza’ were abandoned several years ago. The McGarry Ní Eanaigh braziers which have been used in the development’s branding are never lit. The redevelopment of Smithfield was funded by substantial tax breaks for the developers, on the basis of its becoming this new cultural quarter. This hasn’t been delivered and the developers have trousered the profits while most of the ground floor units lie empty. Only one cultural institution has emerged in Smithfield in the wake of the HARP aspirations. Bizarrely, Tesco was recently granted permission to open a convenience store here on premises occupied by the Complex, a theatre and arts space with a strong community involvement throughout the north inner city. So why the stealth? Surely the provision of a new supermarket will be good for the Smithfield consumer, offering increased competition and more savings in these straitened times? Surely Tesco should be announcing their plans from the beginning; after all, every little helps?
Tesco is an animal not native to these shores. The company entered Ireland through the acquisition of Quinnsworth in 1997 and where most of its stores traded as Tesco Ireland it has rebranded over the past number of years, with the larger stores trading as Tesco and the introduction of the Tesco Express format. With 130 stores (and more on the way) it commands 27.9% of the Irish grocery market and is apparently the country’s biggest private-sector employer with more than 14,000 staff on the books. The company is on the cusp of being the largest retailer in the country, if this hasn’t happened already. Tesco doesn’t publish its profit figures for its Irish operation however, last year UK stockbroker Shore Capital estimated Tesco’s Irish profit margin at 7.2% – bettered only by South Korea within its global network. This amounts to over €200 million annually in hard cash. In 2009 a leaked internal business plan inferred Tesco was aiming to record a gross profit margin here of 9%, excellent news for its shareholders in the UK.
Tesco’s profitability has come under increasing scrutiny in the Republic. There have been allegations of ‘hello-money’, an illegal practice where suppliers effectively bribe the company for shelf space and other allegations of sharp practice, more recently this summer where a cost-cutting campaign was exposed by the Irish Times as giving misleading information on ‘price reductions’. Questions have also been asked regarding the company’s well-advertised commitment to Irish suppliers, where they are unwilling to supply audited accounts as to exactly how much of their product is sourced locally.
On the other side of the coin, Tesco’s expansionist plans have been well publicised by Minister for Jobs Richard Bruton, who delights in the creation of precarious, low-paid positions. Tesco are supporting this month’s Phizzfest and the annual Soccerfest in support of SARI. Well you can’t say they’re racists. Strangely enough though, there has been little attention been given to the quantifiable adverse effects the company has on local communities and the diminution of real choice when it comes to putting food on the family table.
Why would Tesco want to open up shop in Smithfield, after all they operate large supermarkets in Stoneybatter and Phibsborough, Jervis is only two stops away on the Luas and there’s an existing Tesco Express just across the river on Thomas Street? Oh, and let’s not forget the giant superstore nearing completion at the bottom of the Navan Road.
One obvious reason is the vulnerable population of street drinkers, up to 800 of who get their dinner at the Capuchin Centre on nearby Bow Street. Tesco is able to source its cheaper beer from UK suppliers and thus able to sell them below cost to the Irish consumer. Significantly, the company is now appealing the planning decision on the basis that they are not allowed open an off-licence on the site.
On the employment front, Tesco has promised 16 new jobs for the area, which will be offset by the closure of Fresh and the loss of the 56 jobs there, not to mention the loss of several jobs at the Complex and the closure of the only cultural institution in Smithfield, an area after all privately redeveloped with public money to provide a new artistic quarter to balance the boozy excesses of Temple Bar. Whereas Tesco employ locals in their larger stores, staff in their convenience stores are sourced from UK employment agencies. There will be no increase in local jobs in Smithfield.
Outside of Dublin, the provision of large supermarkets on the urban fringes has had the effect of sucking the life out of the town centers, where smaller groceries, fruit and veg shops, newsagents and record stores among others have gone to the wall. The same effect is noticeable in Dublin where consumer choice is being eroded by the multiplicity of Tescos which are forcing out local shops such as Fresh, who have submitted an appeal of their own. Tesco is now effectively targeting such stores to create local monopolies, to the obvious detriment of lower prices and consumer choice. In Ringsend for instance, both the locally owned Londis and Spar have closed down on the opening of the new Tesco. In a working class neighbourhoods and apartment complexes with low levels of car ownership, this is nothing short of disastrous. In the boardroom of Tesco UK however, the Irish profits just keep rolling in, and this is why they keep opening new stores where one would think the market is already saturated.
What can be done? The Irish planning appeals process is not without its faults; but if you have the €20 handy to make an initial submission (usually an objection) to the local planning authority, you’re entitled to lodge what’s known as a third party appeal with An Bord Pleanála if you feel your submission hasn’t been given enough weight or the decision hasn’t gone your way. This will cost you €220 of course, and the time limits are strictly enforced, but an appeal is not completely out of the question especially if the costs can be pooled. Once an appeal against a development has been accepted by the Board, anyone can make an observation for the less prohibitive cost of €50 and in the case of Tesco Smithfield, two such appeals were lodged and merged into one, which has attracted many ‘observers’.
A request for an oral hearing of the case has just been denied by An Bord Pleanála, with no reason given, not that they have to. This means that the appeal will be held in camera with no public opportunity afforded to interrogate a system which so blithely rubber-stamps Tesco’s unrelenting expansion into Dublin’s neighbourhoods, swelling the profits of the company’s UK shareholders in the process. Moreover, there will be no facility to have the actual owner of the building called to question regarding the cultural provision for Smithfield. For what is significant here is the fact that the building, and not just the loan, belongs to NAMA. That’s us, isn’t it?
Having just read ‘Scoring Points’, a book I’m sure you are familiar with, shows how relentless and focussed Tesco are in dominating all markets. After stripping villages and towns with their ‘greenfield sites’ policy, now with the accumulated knowledge of areas through ‘Clubcard’ users, they can focus specifically what goods will sell at each venue without fear of loss, and are currently doing so with ‘Metro,Express, etc.
If some stop is not put to this, every village and town is going to be depersonalised, and local suppliers and traders will be part of folklore.