What accounts for the success of Tesco.com?
We started Tesco.com in 1996. We did it as a skunkworks, with very limited resources. There were just six middle managers, with a direct line into the CEO, who were told to go away and make it work. They spent 2 1/2 years in 12 stores just refining the process. Like a traditional business, you start small and grow. So, we spent practically nothing, less than 1 million [$1.45 million]. Only then did we roll it out to 100 stores, then 240. That’s when we started spending real money. Q: How does that compare with Webvan’s shoot-for-the-moon approach, where it spent $1.2 billion in two years and ended up in bankruptcy? A: You have to make the cost structure work and then roll it out. You can’t make a run for revenues and then work out the cost structure later. We were never caught up in the maelstrom. The point is always to have revenues ahead of costs. We will have spent 40 million [$58 million] on groceries and 60 million [$87 million] in total on all our online stuff. Now, the nonfood b
