A blog about spending wisely in your twenties, with advice on everything from cooking to saving money on gas; how to teach yourself to save money instead of spending it, traveling without breaking the bank, and much more.

Thursday, March 20, 2008

The British Invasion

About six months back, British ubermarket Tesco (think Target or Wal Mart on steroids) began a venture into the American market with a chain of small grocery stores called Fresh & Easy. They began by rolling out about one hundred stores in the Southwestern US. I read a review of the flagship Glendale store on LAist in November-ish, but I didn't actually shop at a Fresh & Easy until February.

I was up in Boyfriend's neck of the woods (in LA) and we drove by a Fresh & Easy just as we were both complaining about being hungry. It was almost ten on a Sunday night and Fresh & Easy seemed like one of the few places that might feed us both- he's a vegetarian and I'm just an indecisive eater. Not picky. Indecisive.

Perhaps the most striking feature of a Fresh & Easy is the lack of cashiers. Or the plethora of robot cashiers, depending on how you look at it. What hit us next was how very like the grocery section of a Tesco it looked. My Mother, Stepdad, and Half-Brother live almost across the street from a Tesco in Britain. Boyfriend and I visited them in January, and when your mother's got a 6 month old to care for and you're flat broke in a foreign country visiting your folks...well, let's just say we spent a lot of time at the Tesco.

Boyfriend got excited when he realized there was vegetarian-friendly food that might actually fill him up and taste good. I started to get really excited when I looked at the prices. Oh my sweet lord are they low! I didn't actually go to Fresh & Easy for proper groceries until this last Sunday, and I don't know that I've ever before walked out of a grocery store feeling like I robbed them.

I bought:
A huge tub of Sour Cream
12 bagels
A jar of ground cinnamon
A package of tri-color noodles
A can of chipotle peppers in adobo sauce
A jar of sauerkraut
A huge can of coffee
and A bottle of pure vanilla extract (not imitation crap)

For $15.23(!!) after a $5 off coupon (most stores are giving away $5 coupons like candy right now. The new chain is apparently under-performing so far this year, which is a shame.)

I'm a huge proponent of shopping at cheaper grocery stores. In Orange County, Stater Bros, Food 4 Less, and now Fresh & Easy are generally the best bets. I've got an Albertson's conveniently around the corner from my house, but I avoid it because other stores are almost always cheaper. When I'm in a hurry and end up buying ingredients at Albertson's (or worse, Ralph's!), I always wince a little when I pull out my debit card.

Fresh & Easy Markets are popping up everywhere, and I can't recommend them enough. If you're in the Southwest, and you've got groceries to buy this week, try Fresh & Easy and let me know what you think of them!

And no, they're not paying me for this. :-)

4 comments:

Erika said...

They just opened one near my house. It's fantastic. I have only been once, but it is now the closest grocery store to me. Now I shop there and Trader Joes. :-)

Charles said...

I don't really like Fresh & Easy - they're good if you're looking for generic whatever or if you're not picky on brands, but if you ARE it can be difficult to find what you want. And their bread is absolutely atrocious.

I work in an industry intimately linked to grocery retailers, and from everything I've seen Tesco is very poorly positioned and the sales numbers bear this out. Here's the problems I see:

Fresh & Easy doesn't have a really well-defined place in the market. Think of the big retailers you're familiar with and the niches they occupy: Whole Foods is the ungodly upscale retailer, Safeway stores tend to be open with some really nice fixtures and architecture, Save-A-Lot is your small discount store.

What Tesco is trying to do is combine two formats, unsuccessfully: the small discount grocer and the organic lifestyle store. Without knowing more about their deployment, I can say that every Fresh & Easy site I've visited or consulted is more likely to be in a low-income area than not. With the balance of products weighted heavily in favor of Tesco-branded items (and VERY few regional items), it's easy to see how this format will be less than successful in a lower-income neighborhood.

The other thing that they're struggling with is supply-chain management - your average F&E is going to be running of fresh-made products as the day drags on, partly a consequence of limited in-store staff but it's also blamed on poor logistics. The name of the store is Fresh & Easy - when they don't have any fresh food, that kinda sucks.

I think the overall problem is that a Wal-Mart kind of company is trying to build a brand that it has never built before - I don't think there are any small (10,000 square feet) Tesco stores in the UK, they're all giant Wal-Mart sized retailers. Incidentally, Tesco is underperforming in the UK as well. High food and fuel costs are going to hurt the kind of retailer that relies on purchasing products at the lowest possible cost.

I wonder why no other retailer is even attempting to reproduce the success of Publix - employees own 30% of the company, and last year they saw growth of 10% despite rising fuel costs and a sluggish economy. They capture the kind of business that I think Tesco is trying to capture - shoppers who want fresh, local food products. Once again though, Tesco is a Wal-Mart kind of company operating stores in a market they are completely unfamiliar with, and their underperforming sales are pretty predictable.

Margaret said...

Charles,

I quite agree that they don't really have a niche here. As far as being picky on brands, that's exactly the kind of spending mentality I'm trying to combat.I've found that nearly every Fresh & Easy (Tesco) branded product is just as good, if not better than some of the other store brands, and cheaper too.

I love Whole Foods. LOVE it. However, it's so overpriced most of the time that I can't justify it.

Everytime I've been to a Fresh & Easy (2 in LA, one down here in Laguna Hills,) they've been well stocked on fresh products, but that's only 3 stores out of many so I can't speak for all of them.

However, I endorse them because I believe that at the end of the day, my own personal financial bottom line is a bigger deal than the labels on my food. And in that regard, Fresh & Easy has great value.

I think it's a shame that they're likely to fail.

klm said...

I was wondering about these, after reading about them in the paper here when they were opening there, and lately about them not doing so well. I think it is a format that can work, but I'm not sure that a foreign chain is the one to succeed at it. Maybe if Wholefoods or Henry's tried it.

(There are smaller Tesco's Charles, they are called Tesco Express. Though I think a closer match as to the type of store a Fresh & Easy is would be a Marks and Spencer Simply Food.