It wasn’t long ago that Tesco was a retail darling. Across the industry it was held up as a great example of a Retail Winner. After all, it does go neck-in-neck with Carrefour as the world’s second largest retailer, behind Walmart. And customer loyalty initiatives, overseen by dunnHumby, are considered some of the world’s best retail practices.
Sure the company stumbled in its U.S. expansion. Fresh & Easy has never succeeded in finding the customer base it was seeking, even though by many accounts, the store had a great product assortment. Still, no one saw something like this coming.
So how did it come to this? The Wall Street Journal appears to have been first out of the gate in announcing that the company has issued a new profit warning and suspended four senior executives due to serious accounting irregularities. The cause has been identified as early bookings of “Commercial Income” and delayed booking of costs.
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Source: Paula Rosenblum (www.forbes.com)
