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Tesco Plans to Double U.S. Expansion Rate of Fresh & Easy Stores
The company announced plans for roughly 400 stores in California within two years and predicted its U.S. stores would turn a profit by 2013.


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Posted: Oct 7, 2010     Email    Print    Print ALL    Comment   

LONDON, ENGLAND – Tesco announced earlier this week that it will increase its U.S. expansion pace, nearly doubling the rate of its current roll-out of Fresh & Easy stores — even as it announced the closure of 13 of those units — the Financial Times reports.

The British supermarket chain said that it has plans for roughly 400 stores in California within two years and predicted its U.S. stores would turn a profit by 2013.

“We will be building to the capacity of the Riverside depot [in suburban Los Angeles], and whether it’s 60 stores next year and 140 the year after, it will be something close to that," said Laurie McIlwee, finance director for Tesco. “We’re focusing more around coastal California, and we’re moving to the north of California as well, where we’ll open around 10 stores in 2011.”

The announcement is a drastic scaling down of plans by outgoing chief executive Sir Terry Leahy, who originally intended for 10,000 Tesco stores in the U.S. The company now has only 168 Fresh & Easy stores, and it is set to close 13.

“To date, we had been opening roughly 50 Fresh & Easy stores a year, or one a week,” McIlwee said. “We were going to open more stores and faster, but because we opened up into the epicenter of the subprime issue it hasn’t been as straightforward as our original plan design. We were going to go into a lot of the new fast-growing cities like Phoenix [Arizona] and Las Vegas [Nevada] and they’re not growing, they’re declining, so we’ve had to re-orient our opening program.”


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