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Pundit’s Mailbag — Observations On
Fresh & Easy’s Competition And Britishness

Jim Prevor’s Perishable Pundit, March 25, 2008

Our coverage of Tesco’s journey to America has often focused on business aspects of the launch of its Fresh & Easy concept. Yet in the end, the success or failure of the concept is likely to depend, as much as anything, on consumer acceptance of its private label offerings, including fresh-cuts and prepared foods.

The minute we saw that 25% of the fresh-cut salad SKUs were being devoted to watercress-based salads — popular in Britain but not so in America — we wondered if British perceptions were being allowed to influence product selection.

One of the most innovative women on the production side of the fresh produce industry sent us a note regarding her first experience with a Fresh & Easy:

I wanted to let you know that I visited my first Fresh & Easy… in Las Vegas… across the street from a Wal-Mart Neighborhood Market… and caddycorner from a very nice Albertson’s.

Anyway… I used to live in London and know Tesco well. I preferred M&S and Sainsbury’s myself, but I think that is because they were very close to my home in London.

Anyway… to the point… loved the Wal-Mart store… reminiscent of a Whole Foods/Trader Joe’s style… produce was the best area.

Afterwards I went to the Fresh & Easy and the parking lot was empty. It was just one other person and myself in the store. I bought a bunch of the value-added produce items to research them, but what I found interesting is that there was a corporate person there hanging out and talking to an employee up front who was there to help you self check-out. She was doing an exit interview on the other person when I was checking out.

I also bought a curry chicken salad for my flight… and once safely on my plane, I saw that the single serving had 850 calories and 65 grams of fat. YUCK. I didn’t eat it. Obviously… anyway… all your commentary made me curious… and thought the corporate survey person doing an exit interview while the employee was working and right in front of a customer was sort of odd too.

This letter is really written from a consumer perspective and points to two things. First, competitive stores respond to the strengths of a new competitor. We mentioned here that Safeway was responding to Fresh & Easy and, doubtless, all nearby stores have it in mind.

Stores near Fresh & Easy are disproportionately being slated for remodels and upgrades, assortment is being adjusted, and price promotions are focused on perceived areas of strength for Fresh & Easy.

Second, it is interesting that it was a dish with curry that our correspondent found so awful. Long ties between India and Britain have led Indian cuisine to be very popular in the UK and in many ways the centerpiece of the prepared foods efforts of food retailers in London.

One wonders if, along with the watercress salads, this is another example of British influence on the product mix.

As far as the odd exit interview — sounds to us as if the corporate exec didn’t actually expect to find many customers in the store!

Many thanks to our correspondent for sending along her insights.