RIVERSIDE, Calif. -- British retailer Tesco PLC has purchased a large piece of land along Interstate 215, south of Riverside, Calif., where it will likely build a distribution center to serve the convenience stores it plans to open on the West Coast, reported The Press-Enterprise.
Tesco bought 88.4 acres in the Meridian business park, a 1,000-acre property near March Air Reserve Base, according to the report, citing documents filed at the Riverside County assessor's office.
Greg Sage, international corporate affairs manager for [image-nocss] Tesco, wouldn't comment on the July 15 purchase or confirm that it will be used for a warehouse, but confirmed for the newspaper that the company does plan a distribution center east of Los Angeles.
But the land is designated for industrial development and will be located next to another food-distribution warehouse owned by McLane Foodservice, the report said.
Earlier this year, as reported in CSP Daily News, the publicly traded British conglomerate announced vague plans to open a chain of stores in the western United States in 2007. It said it would spend $460 million a year to fund the project. The stores reportedly will be modeled on the company's Tesco Express c-store concept.
Tesco has carefully guarded information concerning where it will put its stores and warehouses, where its office will be and other information. For instance, after The Financial Times reported in May that Tesco had placed online job ads for human resources, accounting, distribution and other professional positions in El Segundo, Calif., the ads were removed from websites.
Last month, Long Beach brokerage firm Pacific Capital Retail welcomed Tesco as a client on its website, saying the company was looking for sites in Los Angeles and San Bernardino counties. Shortly thereafter, the information was removed. Pacific Capital president Michael Jensen referred all calls to Tesco employees in the Los Angeles area who didn't return phone calls seeking comment.
Whatever it does, Tesco will face a "brutal" and fiercely competitive market, George Whalin, a retail analyst, told The Press-Enterprise. "They are a little close-mouthed about it, but from what I understand, it is going to be significantly different from what we think of as a traditional convenience store," he said. "Completely new formats are very difficult to pull off." It's hard to convince customers to try something new, he said.
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