Empty shelves is one reason why Tesco has had to make a profit warning. I told them that several times over the past year and received the usual reassuring replies from their Customer Relations department, but no improvement: very little helps! About 20% of the popular best bargain items are out of stock somedays; and the much heralded ''Price Drops' are usually after the prices have been put up previously, which fools no one.
Aldi sells lots of the items Tesco runs out of, usually at a cheaper price, although Tesco is a more pleasant store in which to shop.
The percentage profit at Tesco and other food retailers is only about 5%, so although they have a large turnover they are not making anywhere near as much percentage profit as, say, the Financial sector, and they only pay a reasonable, not great, dividend, if that's what you want.
No doubt Warren will do alright with his shares in Tesco, but not brilliantly if their past performance is repeated. He likes retailers such as Walmart and Sears etc and it's always worth watching his purchases, but he once said that there is never only one cockroach in the kitchen. Maybe Buffett will be the inspiration to the Tesco management to look under their 'fridges!
