LAS VEGAS -- At an event at the Wynn Resort yesterday morning, Tesco PLC officially announced the locations of the first Fresh & Easy Neighborhood Market store sites in the Las Vegas area.
The company is focusing on the Las Vegas area, Phoenix, Los Angeles and San Diego and stores will begin to open later in the year. Tesco said it hopes to have 100 Fresh & Easy Neighborhood Markets in the United States by February 2008, added a Reuters report from the event.
The company said that it chose the Las Vegas area, consistently [image-nocss] one of the fastest growing areas in the country, for its strong potential as an expanding market and its positive business climate. Las Vegas is known for its cutting edge and fast-paced culture, which makes the area a perfect fit for Fresh & Easy Neighborhood Markets," said Fresh & Easy CEO Tim Mason. "We're very excited to bring our concept of convenient, fresh and healthy food to Las Vegas consumers."
Fourteen sites in the Las Vegas area have already been secured and additional locations are being researched. Each of the neighborhood markets will be roughly 10,000 square feet in sizeintentionally smaller than the usual supermarket in order to give customers a faster, easier shopping experience.
The president of one local grocery chain, who will be competing head to head with Tesco in Las Vegas, turned out for the brand's launch. "They sound like they have a wonderful business plan, well financed and well thought out. Those of us who are already here will have to improve our offerings to match theirs," Richard Crawford, president of the Green Valley Grocery chain, which has more than two dozen stores in the Las Vegas area, told Reuters.
The stores, which will be smaller than traditional supermarkets, will focus on ready-to-eat meals and offer more fresh and environmentally friendly products than what is sold at mainstream U.S. grocery and convenience stores. "We want to sell fresh, healthy foods," Mason said at the press conference. "It's not a beer and chips business."
All of the products sold at Fresh & Easy will be free of trans fats, artificial colors and artificial flavors, he said. The stores will not sell cigarettes or tobacco, but will offer beer and wine.
Mason declined to give a target number for further store openings or give a sense of pricing, to avoid tipping off his competitors. He said, however, that the markets are designed to serve customers of all income levels. Fresh & Easy markets will be in a range of neighborhoods, including ones that Tesco said have been underserved by traditional supermarkets. "What we have been preparing to do is go back into some areas which have become a food desert," he said. "Places where major grocery chains have pulled out."
Mason said Tesco had secured around 100 sites in the four target areas where it plans to open stores by the end of February. "Phoenix is already in the public domain...we will be making announcements about Los Angeles, San Diego and Orange County over the next few weeks," he said.
The Fresh & Easy Neighborhood Market format is designed to draw customers back to their local neighborhoods by offering high quality, fresh and nutritious food at affordable prices, said Mason.
The format is a result of extensive customer research in local U.S. markets combined with the learnings from Tesco's Express format, which it operates in more than 1,000 stores in seven countries, serving approximately 10 million customers every week.
We are passionate about being a good neighbor and a good employer, said Mason. We will recruit locally and play an active role in the neighborhoods where our stores are located.
Fresh & Easy already employs 150 people at its headquarters in El Segundo, Calif., and expects to create more than 2,500 new jobs once stores begin opening later this year. The company said it has not made a decision about whether its labor force will be unionized, saying that it would leave that decision up to the employees.
The retailer said it is dedicated to environmentally friendly business practices. To advertise its "green" credentials, all of the markets will have partially green exteriors and a white sail-shaped logo. They will also make use of natural light to cut down on energy bills and emphasize recyclable packaging. It recently announced the installation of a solar panel roofing system at its distribution center that is currently under construction in Riverside, Calif. At 500,000 square feet, the $13 million project is the largest roof-mounted solar installation in California, and possibly the world, said the company. At the store level, waste will be minimized by recycling or reusing all shipping materials and energy consumption will be reduced with modified fridges and lighting.
The company has said that it plans to spend $400 million a year in the United States for the next five years.
Tesco is the UK's largest retailer and one of the world's leading international retailers, operating more than 2,800 stores across 12 countries and employing more than 370,000 people. In 1995, Tesco started to expand overseas and now operates in Ireland, the Czech Republic, Hungary, Poland, Slovakia, Turkey, China, Japan, Malaysia, South Korea and Thailand. Last month the first Tesco-branded store opened in China.
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