Tesco to shut down Tesco Direct in a bid to refocus its non-food business

London - Leading UK retailer Tesco plc is set to shut down Tesco Direct, its non-food website, following a detailed review. Tesco Direct is set to cease trading on July 9, putting 500 employees at risk of being made redundant.

The impending closure comes as Tesco concludes that despite its best efforts to secure the platform, there was no way to ensure future profitability for this small, loss-making part of its business. Tesco Direct is said to have faced a number of significant challenges, including high costs for fulfillment and online marketing which has prevented it from delivering sustainable offers as a standalone non-food business for Tesco, according to a statement.

Tesco Direct, which offers Tesco's apparel line F&F for men and women, as well as its clothing lines for children, babies and toddlers in addition to homeware, furniture and health and beauty, will stop all trading from July 9, 2018. Tesco aims to close its fulfillment centre at Fenny Lock, which handled the Tesco Direct orders. Tesco Direct will fulfill all orders placed before then, although orders may take between 2 and 5 days for delivery after May 22.

Tesco to close non-food website Tesco Direct

The retailer stresses that it "remains committed to bringing a compelling range of general merchandise to its customers, both in-store and online at Tesco.com" and that it aims to develop a simpler online experience for its customers, aggregating its full product assortment, including groceries and apparel in one location.

"We want to offer our customers the ability to buy groceries and non-food products in one place and that’s why we are focusing our investment into one online platform," said Charles Wilson, CEO of Tesco UK & ROI in a statement. "This decision has been a very difficult one to make, but it is an essential step towards establishing a more sustainable non-food offer and growing our business for the future."

500 Tesco employees are at risk of being made redundant across the retailer's business. However, Tesco noted that it aims to support any workers and external partners that may be affected by this shift. The retailer has already begun to bring together all its products on Tesco.com, offering items such as toys, home, and cookware next to groceries. Tesco will also continue to offer its uniform embroidery service and mobile products at tesco.com.

A wide range of Tesco branded clothing, homeware, electricals, toys and gifts will continue to be available in-store in addition to tesco.com. From May 22 onwards Tesco Direct will cease to offer next-day delivery or Click and Collect orders.

Photos: Courtesy of Tesco