Tesco purchases €1.6bn a year in Irish food and drink, report finds

Tesco purchases €1.6 billion in Irish food and drink annually, making it the single largest retail buyer of such goods in the world, according to an analysis commissioned by the supermarket chain from economic consultants Indecon.

The British grocery retailer said its gross contribution to Irish gross domestic product (GDP) was now €1.87 billion and that when economic multiplier effects were considered it was contributing €3.05 billion to the Irish economy, up 22 per cent since 2007.

When other goods and services – including wages – are included, Tesco’s expenditure in the Republic arrives at €2.44 billion, it said, up 26 per cent over the past 15 years.

Exports of Irish food, drink and other products to stores outside the State come to almost €1 billion, or a sum of €960 million, of which €870 million relates to food and drink. The other €730 million in food and drink purchases, out of the total of €1.6 billion, is sold domestically in the Irish market.

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Tesco, which entered the market here 25 years ago, said the Indecon figures, which are based on its 2021-2022 financial year, showed its purchases of Irish food and drink remained “robust” during the pandemic and throughout supply chain challenges following Brexit.

Exports of Irish food and drink to Tesco represented almost 6.5 per cent of the total value exported during 2021, which Bord Bia recorded as €13.5 billion. Exports to Tesco stores in the UK and central Europe have grown by more than 47 per cent in 15 years, it said.

William H Batt, who led the study for Indecon, said Tesco’s purchases of Irish food and drink exceeded the State’s overall agri-food exports to each of France, Germany, the Netherlands and the US in 2021. “Given the scale of these purchases, Indecon’s research suggests that Tesco is the single largest retail purchaser of Irish food and drink in the world,” he said.

Tesco Ireland chief executive Natasha Adams said the research showed Tesco was “adding real value” to the Irish economy through exports and employment. “Our significant spend with Irish businesses helps to secure the jobs of local people and many local Irish suppliers. In addition, the success of Irish farmers and food processors supplying us domestically and exporting to Tesco internationally reflects the outstanding quality and unwavering commitment of the Irish agri-food sector.”

Ms Adams added that Tesco, which employs more than 13,000 people across Ireland and has 155 stores in the Republic, was “acutely aware” that the current cost-of-living crisis was “placing a huge burden” on many individuals and families.

Tesco has the second biggest share of the Irish grocery market, according to recent figures from research firm Kantar, with a share of 21.9 per cent, putting it behind Dunnes Stores on 22.3 per cent but ahead of SuperValu on 21.4 per cent.