Irish Food and Drink Exports to Tesco Amount to €705.8 million

Tesco Value to Irish Economy Now €2.7billion per annum.

25 March 2012

Exports to Tesco represented 9% of the total value of Irish food and drink exported during 2010, according to a new report by Indecon International Economic Consultants.

The report has found that Irish suppliers exported a total of €705.8 million of Irish-produced goods to the Tesco group internationally in 2010. The market destinations were Tesco stores in the United Kingdom, Central Europe and Asia. €705.8m exceeds the total value of Irish food/drink exports to France (€524m), Germany or USA.

Total beef exports to Tesco Group reached €177 million in 2010, almost 14% of the entire value of beef exports from Ireland.

Key product categories exported to Tesco were fresh meat (including beef) worth €205.6m, dairy products (€178.2m), drinks (€116.6m), vegetables and horticulture (€51.9m), health/beauty and pharmaceuticals (€47.4m), fish/poultry/frozen food (€35.0m), bakery products (€24.8m), grocery (€11.1m) and household products (€20.8m).

The report also found that Tesco is now worth €2.7 billion a year to the Irish economy, with total expenditure on goods and services in Ireland amounting to almost €2 billion. The total contribution of Tesco Group activities to Irish GDP is estimated to be €1.7 billion, or 1.1% of GDP*. In 2010, Tesco Ireland contributed €198.5 million in tax payments to the Irish Exchequer.

14,925 people are now employed across its store network in Ireland with Irish-based suppliers to Tesco employing over 29,000 people. A total of 6,625 new jobs have been created as a result of Tesco’s investment since 2000, while earnings by Tesco employees exceed €300million annually.

The report by Indecon International Economic Consultants, entitled "Assessment of the Economic Impact of Tesco on the Irish Economy", is an independent evaluation and details the latest quantified empirical evidence on exports and other economic contributions by Tesco.

William H. Batt, the report’s author and Indecon Partner, said: "The new data shows the significance of Tesco’s role in the facilitation of exports, in particular in the area of beef, but also in its overall and substantial contribution to the Irish economy."

Tony Keohane, Chief Executive, Tesco Ireland said: "Our investment of over €1.5billion in this country over the past ten years is now paying considerable dividends for Ireland in the form of exports, employment and value add to the economy. We are very proud of this contribution and intend to continue playing a constructive role in supporting a recovery in Ireland’s economy. It is a win-win situation for Ireland and for Tesco".

"The success of Irish farmers and food processors supplying us here and particularly as exporters to Tesco internationally, reflects both the quality and value of Irish produce as well as the professionalism of our food businesses in world markets," he said. "The expansion of our Irish supplier development programme this year will, we hope, open new opportunities for Irish farming and food businesses to expand in both the domestic and export markets."

The Indecon study assesses the overall macro-economic contribution of Tesco Ireland and the wider Tesco Group on the Irish economy. It also analyses the important role the company plays bolstering small and medium-sized enterprises.

Key findings:

• Taking into account the multiplier effects of expenditures across the economy, Tesco is worth €2.7 billion in overall expenditure terms to the Irish economy.
• Tesco group expenditures on Irish-produced goods and services amounts to €1.95 billion.
• The gross contribution of Tesco group activities in Ireland to Irish GDP is estimated at €1.7 billion (1.1% of total GDP).
• In 2010, Tesco Ireland contributed €198.5 million in tax payments to the Irish Exchequer.
• During 2010, Irish exports to Tesco internationally were €705.8 million. This represents over 9% of the overall value of food and drink exports from Ireland.
• Irish food exports to Tesco surpassed the overall value of exports of Irish-produced food & drink to France (Ireland’s 2nd largest export market for such products) as well as to other major export markets such as Germany and USA.
• The value of Irish Beef exports purchased by Tesco reached €177 million in 2010 representing almost 14% of the value of total beef exports from Ireland.
• Tesco Ireland currently directly employs 14,925 people in Ireland. A total of 6,625 jobs have been created resulting from investment by Tesco since 2000.
• Tesco Ireland suppliers include between 350-400 small and medium-sized enterprises. Of this, approximately 300 represent firms employing less than 50 people.

* The figure of €1.7 billion gross contribution of Tesco Group’s activities in Ireland to Irish GDP represents the overall value of all goods & services which have been produced domestically within Ireland over a defined period as a result of Tesco’s effect on the supply chain. It differs from the €2.7 billion total expenditure figure in that it includes an adjustment to reflect any imports used within domestic expenditures.