LOS ANGELES -- One thing that is clear upon visiting a site set for what has been described as a small Tesco Fresh & Easy supermarket is the maturity of the neighborhood. The West Covina suburb in Los Angeles County is by no means a burgeoning suburban development the likes surrounding Phoenix or Las Vegas.
For retailers tracking the movements of the U.K. grocery and convenience-store retailer, what's surprising is the maturity of West Covina a well-populated community of single-story homes probably built in the 1960s and 70s. Published reports [image-nocss] have named several sites around L.A. earmarked for the Fresh & Easy format, with an anchor corner in a mature but vital mall in West Covina being one of them.
A visit this past week to the mall revealed a few aspects of the U.K. retailer's small supermarket strategy. First of all, the site is a vacant 17,000-square-foot retail space formerly occupied by a high-end stereo and entertainment-center store one that sold products too pricey for the middle-income neighborhood, according to locals attending a Saturday morning farmer's market fronting the site. They described the community as diverse, with many of the newer families being Latino, Filipino and Korean.
The site does not have direct competition from a neighboring grocery store, but neither does it have the parking expanse of a typical supermarket. The vacant store shares a parking lot with other retailers in the mall and clearly has no room for the traffic patterns or the underground storage equipment needed for a gasoline offering.
For many industry observers, Tesco's move to get into 17,000-square-foot spaces is unusual. C-store consultant Gerald Lewis told CSP Daily News that Tesco watchers have reported that they would be introducing only one format called Fresh & Easy, because the Tesco brand is unknown here. The format was expected to be modeled on the U.K Tesco Express stores, which have 3,000-square-foot (selling area) footprints.
At least that was what everybody thought until Tesco started acquiring 17,000-square-foot buildings, a size that they don't have in their portfolio of formats in the U.K., Lewis said. Also gas is a key component oftheir U.K. offer.
What does seem apparent is how a new retail format featuring fresh grocery and ready-to-eat offerings may play well in West Covina. The community seems primed for something new, which Tesco appears ready to offer.
Financial Times reports said Tesco executives have looked at an estimated 300 sites for its small supermarket format in California, Arizona and Nevada, having set up a headquarters in El Segundo, which is near the L.A. airport. The Times reported that Tesco has thus far secured 12 locations in Los Angeles, Orange, Riverside, San Bernadino and San Diego counties.
A gentleman overseeing the West Covina farmer's market set up in front of the vacant store acknowledged he had heard about a new grocery store opening up in the space. That's too bad for me, he said. A grocery store will never let me use this place for a farmer's market.
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