Supermarket giant Tesco is contemplating a move into the online business segment. The corporation is seriously looking at options to enter into the real estate world by selling homes via it's website, covering the UK property market.
The Grocer magazine has reported that Tesco is consulting a specialist Internet developer to give a fillip to its idea of allowing people to sell their homes online through its site. When contacted Tesco said that it has no plans to move into the housing sector, but was looking for ways to extend its online presence, "Customers expect us to look at lots of different new ways we could extend our online services. We've made it clear our focus at the moment is to concentrate on the new businesses we launched last year - ediets, Tesco Jersey and DVD rental. We have no current plans to launch a housing service," the company said.
Tesco is looking towards real estate in view of peoples' growing disenchantment with property agents. It is believed that these agents who charge exorbitant amounts for their services, "offer poor value and poor service." Estate agents take a cut of 1% and 2% of a property's value in order to market it. Tesco thinks that it can offer cheaper service via its Website.
Analysts feel that this move will benefit vendors and buyers alike, 'No one likes estate agents and if you're comparing trusted brands, Tesco will come out on top any day against any estate agent. This property website is a no brainer for Tesco,’ an analyst was quoted as saying. He added that Tesco's entry into this segment would be financially productive for the supermarket giant and adds to its mortgages and home insurance business. Tesco's property Web site will require a prospective buyer to register him/herself as well as provide their credit card details. At the moment, Tesco has not revealed anything else.
Tesco became the first UK retailer to make more than £2bn in annual profits in 2004, and also reported net earnings of $5.4 million for the quarter ending March 31,2005. Tesco also announced that its staff would share £220 million in what is believed to be the UK's biggest staff bonus.
Posted
on : Fri, 20 May 2005 20:00 GMT | Mortgages News
By : Rob Davis
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