Tesco to trial Next concession in London store

LONDON (Reuters) - Tesco, Britain's biggest retailer, has struck a deal with Next to trial a clothing concession in one of its largest supermarkets, it said on Thursday.

As UK shoppers increasingly use smaller convenience stores and shop online, Tesco, in common with Britain's other major supermarket groups, is refitting its once bustling superstores with new attractions such as rival retail brands to fill space.

The trial would take place in the Tesco Extra store at Surrey Quays, east London, with Next taking 4,300 square feet of space, a spokeswoman for Tesco said.

"We're pleased to be partnering with Next...and look forward to seeing how customers respond," she said.

Tesco already has third-party concession deals with firms such as electricals and mobile phone retailer Dixons Carphone, fashion retailer Arcadia and health foods seller Holland and Barrett.

Last year Sainsbury's Britain's second-biggest supermarket group, acquired Argos owner Home Retail for 1.1 bilion pounds, and is rolling-out Argos concessions across its store estate.

Next, which could not be immediately reached for comment, is Britain's most successful clothing retailer this century in terms of profits, but has faltered over the last two years due to a shift in spending away from clothing.

(Reporting by James Davey; Editing by Keith Weir)