Fresh & Easy

Fresh & Easy, or, in full, Fresh & Easy Neighborhood Market, is a chain of small supermarkets on the West Coast of the United States. It is a subsidiary of the UK-based retailer Tesco, the world's fourth largest retailer, and is Tesco's attempt to expand into the United States. It has plans for rapid growth - the first stores opened in November 2007, and there are now (16th September 2008) 82 stores in Southern California, Arizona and Nevada.

Tesco's initial United States expansion plans

On February 9, 2006, Tesco announced that it planned to move into the United States by opening a chain of small format grocery stores on the West Coast (Arizona, California and Nevada) in 2007 named Fresh & Easy. The initial planned capital expenditure is up to £250 ($507m) million per year. Tesco CEO Terry Leahy stated,

"We have committed serious resources to developing a format that we believe will be really popular with American consumers".

Investors responded with some scepticism to the project, with a small fall in the company's share price on the day of the announcement.

There is a distribution center in Riverside, California and the company will initially expand into northern and southern California, Phoenix, Arizona, and Las Vegas, Nevada. The San Francisco Bay Area will be served by a new distribution center in Stockton, California that shall feed into 500 planned Bay Area stores.

Three months later, in May 2006, the Los Angeles Times reported that Tesco had purchased a 130,000 m² (1,400,000 sq ft) distribution center in Riverside County, California, near Los Angeles, and planned to acquire another in Phoenix, Arizona. The markets were expected to be around 1,400 m² (15,000 sq ft) - good sized supermarkets in many countries, but about one-third the size of an average supermarket within the U.S..

By January 2007, Tesco opened its U.S. headquarters in El Segundo, California, near Los Angeles International Airport. Tesco also began construction on the Riverside County distribution center in Moreno Valley, California near the former March Air Reserve Base. This distribution center will have California's largest solar panel roofing system. The company is looking for another distribution center location in Stockton, California, strategic for entering the Northern California region.

Stores

First U.S. stores

Fresh & Easy had announced in October 2007 that the first California and Arizona stores would open November 8. However on November 1, 2007, Fresh & Easy opened its first store, in Hemet, California, as a "soft opening". (Soft openings are traditionally done in the retail business to test systems and store staff, and prepare for a larger "grand opening.") The Hemet store, near the company's distribution center, along with five others in Los Angeles and Orange Counties, then had their "grand opening" on November 8 2007.

Fresh & Easy Neighborhood Market currently employs 20 to 30 associates per store.

In California, part time employees are paid a starting hourly wage of $10 hour. Those who work at least 20 hours per week get a health insurance plan which they also contribute to. Assistant managers, called Team Leaders, currently are paid $13 hour. In Arizona and Nevada, each of these positions pay $1 per hour less.

Two of the current 76 Fresh & Easy Neighborhood Market stores are located in urban underserved areas, also called "food deserts," where there are few if any supermarkets. One is the Eagle Rock or Glassell Park store and the other store is in Compton, California.

Tesco will open three Fresh & Easy Neighborhood Market stores in underserved neighborhoods in Northern California early next year: one in San Francisco's Bayview-Hunters Point neighborhood, one in a neighborhood in Oakland currently underserved by supermarkets, Oakland,and one in the Oak Park Neighborhood of Sacramento. The Oak Park location is being developed by former NBA basketball all star Kevin Johnson, who also is a candidate in 2008 for Mayor of Sacramento.

From April, 2008 until the end of June, Fresh & Easy Neighborhood Market took a pause from opening any new stores. That hiatus was lifted with the July 2, 2008 opening of a store in Manhattan Beach, California. Tesco now has 76 total Fresh & Easy stores as of August 30th, 2008.

Southern California

In 2007, Tesco identified many initial Southern California locations, and as of 30th August there is a network of 41 stores currently open.

Arizona

July 2007, Tesco announced plan for several Arizona stores. The first Mesa, Arizona, store opened December 5, 2007. As of August 2008, 21 locations are in operation in the greater Phoenix area.

Nevada

The first five Nevada stores opened in the Las Vegas area November 11, 2007. As of August 2008, 14 locations are in operation in and around Las Vegas.

President and CEO

Tim J.R. Mason is the President and Chief Executive Officer of Fresh & Easy. He joined Tesco in 1982 and became a member of the Board in 1995. Mason relocated to the U.S. with his family as part of the assignment of building the U.S. presence. He led the team researching the U.S. market prior to the company opening its first American store.

"Probably the most surprising thing to me was the number of different stores that an American family uses to shop. They shop in up to 20 different stores – many more than the equivalent would in the UK. They will use different types of shop for their food, for their cleaning products and for their personal care products. What I discovered is that you just can't get everything that you want in one place... The main retail brands in Britain have much higher levels of loyalty and genuinely do fulfil the notion of a one-stop shop. That's less of the case here. People will wait for flyers and coupons and indeed, people who have time but not money, will actually take their shopping list and walk to two or three big players and then decide what to buy."—Tim Mason, 2007

Environmental goals

Fresh & Easy states it has made a commitment to building Leadership in Energy and Environmental Design certified buildings. It will recycle or reuse shipping and display products. Its food transportation trailers are hybrid electric-diesel. The Riverside distribution center hosts California's largest solar roof installation. Stores are equipped with LED lights in freezers, coolers and for outdoor signage. Some stores have reserved parking for hybrid cars.

References

External links

• fresh&easy Official website
• Retail Case Study: Anatomy of A Tesco Fresh and Easy Neighborhood