Tesco have announced a tie-up with IWG to provide flexible office space in their stores. The partnership, which will be known as Spaces, will launch with a 3,800 square foot flexible work space in Tesco's New Malden branch. It will provide 12 private desks, 30 co-working spaces and a meeting room.
IWG, the owner of Regus, are experienced in providing flexible office space and the move comes as many businesses are assessing their response to changes in working patterns triggered by the pandemic. If a success the model could allow businesses to consider a hub and spoke model, utilising Tesco's extensive suburban coverage.
The venture perhaps says as much about the changing landscape of retail as it does about the office market, both of which are repositioning themselves following the rise of digital media and to meet the needs of a post-pandemic world. Tesco have numerous existing in-store partnerships and this latest move will allow them to potentially utilise space which was previously given over to merchandise, such as music and films, which are increasingly consumed on-line.
This isn't the first time a retailer has looked to the office sector to shed unwanted square footage. House of Fraser at Westfield and John Lewis on Oxford Street both recently announced that they were looking to implement similar schemes. Clearly great minds think alike, but the question remains how much flex space the market requires.
I will be interested to see if the co-working desks align with Sir John Cohen's pile it high sell it cheap mantra or if consumers now have greater expectations of wellness and amenity from their work place. Either way, in a difficult market, every little helps.
"A Tesco Extra in a suburban location, in the middle of a vibrant local community, is the perfect location for flexible office space." Mark Dixon, chief executive, IWG