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He said, "This began with a carefully selected range so customers can find what they want against what is, conventionally, in the U.S. a huge choice. It had reached the point where too much choice made life complicatedjust try shopping a salad dressing fixture in the U.S."
Ryder told the U.K. convenience industry news outlet, a European partner for the U.S.-based National Association of Convenience Stores (NACS), that Fresh & Easy fits into the U.S. marketplace by filling the gap between larger and smaller retail formats. "The U.S. market breaks down between 3,000 and 4,000-square-foot convenience stores at one end, supermarkets of 35,000 to 80,000 sq. ft. and supercentres of 120,000 to 200,000 sq. ft. at the other. There is a gap between 4,000-sq.-ft. stores and 35,000 sq. ft. plus. In Europe, that gap is filled by discount stores, but in the U.S., this segment is underserved. So our goal was to fill this gap and make stores easy to reach located in the neighborhood and also quick and easy to get round."
El Segundo, Calif.-based Fresh & Easy opened its first store on 31 Oct. 31, 2007. The business now has 30 stores in the Arizona-greater Phoenix area, 74 stores in Southern California (with plans to open in Northern California) and 26 stores in the Las Vegas market.
Ryder, who has worked for Tesco for 30 years in various functions from store design to planning and space management, built the original mock Fresh & Easy site in a California warehouse, which he said still exists.
He also described what influenced the creation of Fresh & Easy: "Aldi is good at value cues and creating a discount feel, and in the U.S. market Trader Joe's offers a shopping experience which is a bit quirky. Whole Foods offers freshness. My initial observation was that stores here were externally blandbeige, concrete, indistinguishable apart from the logo, very similar looking. So we wanted to use the building as part of the brand communication. Think how Ikea does itthe design is the brand. Tesco in the UK and Central Europe has a distinctive style, when you see the building, you know what the brand is."
He said, "Externally at Fresh & Easy, we have the three 'Gs': Glass (visual and environmental benefits), green (corporate color) and geometry (the sail shape on the corner of the building)."
Inside, said Ryder, "the store dimensions are 125 feet by 82 feet with an eight aisle layout. Aisles are wide by U.S. standards at 7 ft., 5 inches, and we started with low shelves. These two features combined to give a very spacious feel for U.S. customers. Departments are grouped logically; fresh first in flow ahead of grocery with frozen food last in flow. All the checkouts are self-scanning units, but staff are on hand to help so we call the operation-assisted self-scanning."
He added, "One-touch replenishment is a reality. The warehouse is small and is simply a holding area between the truck and the shelf. Our grocery shelves are 44-in. deep so you can put a pallet in and it doesn't stick out. So the front of the shelf is sales and the back of the shelf is the 'stockroom.' The decision to have no ceiling and a concrete floor give the visual cues of discountthe flooring was changed to a warmer terracotta style as we had some customer feedback that it looked too 'discount.' The minimalist design is intended to highlight the products."
Since the stores opened, executives have "done a lot of listening to customers and have responded in product and design terms. We had some negative feedback on designwords like 'sterile'."
So Fresh & Easy responded in two ways: First, at 60 stores, it carried out a refresh program; it made the stores more inviting and informative. It added additional banners, redesigned panels on grocery ends, added messages about meat and fresh meals, added color to the checkouts and added messages to the walls explaining the key strands of the philosophy.
Second, in 2009, at 120 stores the company remodeled stores after 18 months of "trading knowledge and in the context of a dramatic change in the economy." It increased frozen food space, refrigerated all beer and added 600 SKUs by increasing the height of the grocery aisles by up to 10 inches without increasing congestion.
"We also changed the decor again and linked the messages to our first external ad campaign on advertising hoardings, buses and on radio," Ryder told Global Convenience Store Focus. "Messages are linked to delivering honest low prices by reducing capital expenditure, no additives or preservatives in own label products, date coding everythingincluding loose product, local sourcing where possible, re-use and re-cycling."
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