After revealing robust half year results earlier this week, Tesco’s Chief Executive Dave Lewis said he sees Amazon as a “formidable competitor”.

The online giant has recently scaled up its ambitions in the grocery sector with the acquisition of US chain Whole Foods Market.  In the UK, the group has been rolling out its AmazonFresh service in London and beyond.

“We have to respect Amazon,” Lewis said this week. “We see them as a formidable competitor.”

However, he stressed that Tesco was in a strong position to compete with the online retailer, highlighting that delivering and handling food is very different to delivering non-food. “If we as Tesco play to the strengths that we have in terms of the stores we have and the delivery capability we have, then actually we can deliver a great service for customers that is very difficult to compete with,” Lewis said.

He added that the Whole Foods deal shows Amazon is “trying to buy things that we as Tesco already have” and that his company will have to keep on its toes to remain competitive.

Lewis said: “We should just be mindful as to what it is Amazon are doing, look at the strengths of what it is they ultimately bring to the market, and ask ourselves as Tesco: how do we do better? Just don’t give up where we start from – we start from a very good place.”