Tesco's new chief: 'I won't take any hasty decisions'

Tesco's new chief executive, Dave Lewis, has said he won’t be hustled into making any “hasty decisions” about how to revive the struggling retail giant, despite shares losing a further 2pc on his first day in the job.

Mr Lewis, whose starting date was moved forward by a month after Tesco last week issued its third profit warning for 2014, issued a rallying cry to staff on Monday, as shares took another turn for the worse.

The former Unilever executive, who admits he has never run a shop before, acknowledged that Tesco has some “urgent issues to deal with” but said the group needs to “keep it simple and customer focused” as it looks to re-stamp its authority in the UK market in particular, following a bruising couple of years.

In an internal message to staff, Mr Lewis said: “You will know only too well that is has not been an easy time for our business. The retail market in all countries where we operate has become extremely tough, and is changing faster than ever. We are losing market share in our largest market and we need to address this with urgency.

“The most important thing is that we all focus on being on top of our game. We need to keep it simple and customer-focused.”

He continued: “Clearly we all want to see an improvement in performance, but I won’t take any hasty decisions. The decisions I take will be based on what’s best for customers, for shareholders, for colleagues, and hence the whole Tesco business. We have some urgent issues to deal with, but we must address these in a way which is consistent with building a long-term sustainable future.”

Mr Lewis’s first day in the job did not start under ideal circumstances as shares in the retailer’s shares dropped more than 2pc, adding to heavy losses last week.

Mr Lewis had hoped to take a month off between finishing at Unilever last Friday, where he had worked for 27 years, latterly as global president for personal care. However that break was shortened to just a weekend, after the supermarket giant last week issued a shock profits warning and took an axe to the dividend.

To add to his challenges on day one, The Telegraph revealed over the weekend that one of Tesco’s biggest and most faithful investors, US investment fund Harris Associates, has cut its holding in the UK retailer by two-thirds. David Herro, chief executive of Harris Associates, said he wanted to see “a clear and coherent” strategy from Mr Lewis before deciding what to do with the remainder of its stake.

Bruno Monteyne, senior analyst at Sanford C. Bernstein and a former executive at Tesco, on Monday penned an open letter to Mr Lewis suggesting a radical change of direction, including, potentially creating a new low cost store brand to take on the discounters, Aldi and Lidl.

Mr Monteyne also suggested that Tesco re-hire some of its former “heavy hitters” to boost morale and reinstill confidence.

“Tesco lost some amazing executives. Bringing a few of the really heavy hitters back, as a sign of 'back to the culture that made Tesco great’ may not be a bad signal,” Mr Monteyne said.

But Shore Capital analyst, Clive Black, said there is “no quick fix” for Tesco’s problems. He said: “Indeed, the challenges faced by this business, some from within, some from without, have seen off Philip Clarke, and so realistic expectations need to be set, to our minds, for Mr Lewis deliver a sustained improvement in financial performance.”

Mr Lewis said he will spend his first few days at Tesco’s head office in Cheshunt and will visit as many stores as possible. He is also due to meet some shareholders and analysts.

Tesco declined to comment.