Fresh & Easy Continues Shutting Down Stores

U.K-based Tesco is closing its U.S.-based Fresh & Easy grocery stores.

October 23, 2015

LOS ANGELES – European grocery retail chain Tesco is in the process of closing its Fresh & Easy stores, reports the LA Times.

In March, the retailer announced the closure of about 50 Fresh & Easy stores in California, Arizona and Nevada. The newspaper writes that analysts say the chain could shortly file for bankruptcy protection, which would signal “the death knell for Fresh & Easy,” which opened its first U.S.-based stores in 2007.

Analysts also point to Fresh & Easy’s failure to personalize the merchandise selection in stores to their neighborhoods as one cause for the demise of the chain, which often faced out-of-stock situations and charged as much as 20% more for private-label products than brand-name counterparts, notes the news source. Tesco also paid millions for an 850,000-square-foot distribution center in Riverside County, which put pressure on the chain to expand quickly.

Then there is the brand’s practice of wrapping items in cellophane, which prevented shoppers from inspecting produce or buying just one or two items instead of a prepackaged amount. “The company expected customers to adapt to its way of doing business, instead of accommodating how locals like to buy food,” writes the LA Times.

Jim Hertel, managing partner of food retail consulting firm Willard Bishop, commented that Fresh & Easy “made a big deal out of the fact that they had done all this consumer research… Yet at the end of it, what they delivered is what they wanted to deliver, and the consumer didn't play ball with them in terms of changing their behavior.”

New competition also plagued Fresh & Easy's chances of survival, as retailers such as Walmart and Target expanded their food offers, and more shoppers turned to farmers’ markets for produce. “Almost everybody in California has access to local and fresh produce because it's grown 20 miles away,” Hertel said.

So while the Fresh & Easy brand will likely die off in the United States, according to analysts, the real estate could go to potential buyers such as Aldi or CVS.

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