Tesco Rethinks U.S. Fresh & Easy Strategy

The British grocer is "temporarily" closing a dozen more stores as it scrambles to figure out how to restart its U.S. chain.

January 20, 2012

LONDON - Five years ago, Tesco made a big splash with the debut of its Fresh & Easy format in the western part of the United States. Initially targeting so-called food deserts, Fresh & Easy stores have not had much success, The Guardian reports.

So far this year, the British company has announced plans to shutter for a time a dozen stores in California, Arizona and Nevada, some located in underserved areas. However, Tesco also revealed its plans to open 25 new stores by April in more affluent locations.

The company said it was refiguring its U.S. strategy. "We??re constantly refining and changing," said Roberto Munoz, spokesman.

But analysts and union advocates have said Tesco has missed the mark on understanding the U.S. market and the communities of which its Fresh & Easy brand are part. "Tesco has such a strong reputation in England for being an industry leader in workplace standards and overall operations, but you can't say remotely the same thing about the way they've operated in the U.S.," said Jill Cashen, director of communications for the United Food and Commercial Workers union. "They are not leading in terms of standards or operations or even the kind of outlet they've created."

The company contends such criticism is unwarranted because the company has changed some of its policies. Munoz said December sales were quite positive.

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