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A PRETTY GIRL in a security uniform looked up from her puzzle book to take the details of a Corona beer delivery man before letting him into the shrouded Fresh & Easy Neighborhood Market store in the sleepy, middle-class suburb of Arcadia in Los Angeles.
Inside, under bare neon lighting, staff were stacking shelves with see-through plastic bags of pasta ahead of the store’s opening this Thursday.
After my glimpse in the doorway, the smiling girl barred my way, saying: “We’re busy getting ready for next week, but I can’t tell you anything – it’s gonna be a big surprise.”
The door slammed shut and the Highland Center, a strip mall a few minutes’ drive from the world-famous Santa Anita racetrack, returned to basking in the November sunshine.
But 100 yards away, across Arcadia’s 2nd Avenue, lies the competition: a branch of Ralph’s, a traditional, full-service supermarket.
The manager, Kyle Godfrey, seemed nonchalant about the newcomer’s arrival. “I’m not losing any sleep over it,” he said. “We cater for the mainstream customer, and my information is that they will be nonmainstream.”
The Arcadia Fresh & Easy branch will be one of six stores in the Los Angeles area to open on Thursday, to be followed by others in San Diego near the Mexican border, Phoenix in Arizona and Las Vegas, Nevada. The aim is to have about 100 on the west coast before rolling out the concept on the eastern seaboard.
Tesco claims to have spent years researching and planning the Fresh & Easy format. The result is a typical 10,000 sq ft store, a fifth the size of a standard supermarket, with a strong emphasis on fresh and organic food and private labels, with recipe advice.
Tim Mason, head of the American operation, said Fresh & Easy is based on the Tesco Express approach in Britain, featuring fresh produce, alcohol and an instore bakery.
“We are for people who have enough money, but not buckets of money,” said Mason.
What has been disclosed so far about Fresh & Easy makes it sound like Trader Joe’s, a Californian chain that was bought in 1979 by Theo Albrecht, one of the German brothers who founded the Aldi discount store group. But Trader Joe’s does not have a wide enough range to be the one-stop shop that Tesco would like Fresh & Easy to be.
The other main local rivals, Whole Foods and Bristol Farms, have high prices that Tesco will easily undercut. But the customers of these supermarkets are liberal-leaning middle class, very much a minority.
Carolyn Reyes, 33, a graphic designer from West Hollywood, said: “When I first heard the name Fresh & Easy, I thought it sounded like a tampon. The key to them surviving is to get the prices right, but I don’t know if they could ever take on Trader Joe’s, which has immense customer loyalty.”
Beth Copti, 41, an executive PA who will be within easy reach of the Fresh & Easy in Monrovia, east of Los Angeles, said: “I would like to see them sell hot and cold healthy food that can be put on a plate quickly. There are lots of people here who leave home before 7am and get home after 7pm. They don’t want some of the less healthy dishes from the lower-end supermarkets, but can’t afford stuff from fancier places all the time.”
Rivals, British and American, are watching the project closely. Marks & Spencer and Sainsbury have had high-profile failures in America.
Tesco is playing for high stakes. Mason and Sir Terry Leahy, the group’s 51-year-old chief executive, have been criticised over a multi-million pound bonus scheme tied to success in America.
Some analysts question whether Fresh & Easy is merely a test run, so that Tesco can get to know the local market before launching a frontal attack on the established chains.
Its large Riverside distribution centre, midway between Los Angeles and Las Vegas, suggests the door is being kept open for such a possibility. And it irks Leahy that Wal-Mart is the world’s biggest retailer while Tesco is only third.
Tesco spokesman Greg Sage stresses that the plan is purely to roll out Fresh & Easy across America, and that this will take several years. But he refuses to rule out an assault on the mainstream food market.
“You never say never in this business,” he said.
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I've just arrived back in London after living in LA for 20 years. We tried the Fresh and Easy near Newport Beach, CA. I've also got a local Tesco Metro near wherer I live. I love Trader Joes, use Ralphs a lot and know Whole Foods well. The Fresh and Easy looked kinda sad and run down.
Mark Laing, London, United Kingdom
My prediction is that Tesco will go back to the UK licking its wounds when it fails in the US. UK retailers fail in the US for a very simple reason - they do not understand customer service. American consumers tend to be more demanding and have more retail options that British consumers. From a service point of view, Tesco, Sainsburys and Morrisons are all equally as good or bad as one another, so a shopper that has had a bad experience at any one of these supermarkets will likely shop at the same supermarket again because the alternative options are just as bad or good. Poor service in America will however be rewarded by customers going elsewhere to another retailer that offers better service - and there are many of those in the largest consumer market around.
Ed, Minneapolis, USa