Tesco Comes to America
Shoppers & Trends
from our newsletter, broadcast on
Monday November 26, 2007
Monday November 26, 2007
Earlier this month, British retailer Tesco made headlines with the opening of several much-anticipated “Fresh & Easy” stores in the United States. Fresh & Easy is an attempt to provide wholesome foods that are accessible, convenient and affordable without skimping on traditionally higher end items like organics.
While branching into the American market may seem like the next logical step for a company that transformed itself from Britain’s third-ranked supermarket by sales to the third-largest in the world (after Wal-Mart and France’s Carrefour), Tesco’s recent operation is not particularly British. In fact, years of research on American shopping habits were conducted to help the company create a store to meet the specific needs of Americans. What they learned was simple. Americans want our stores to look like Whole Foods Market, but feature Wal-Mart prices.
Part Trader Joe’s, part Vons or Ralph's, Fresh & Easy is smaller than the typical neighborhood supermarket, yet big enough to carry familiar brands. The new stores offer fresh, healthy, and prepared foods at everyday low prices. A detail that makes Fresh & Easy truly unique, however, is its extraordinary commitment to environment. Tesco estimates that Fresh & Easy stores will use up to 30% less energy than a typical grocery store. Other green initiatives include LED lighting, better insulation and skylights.
Food safety is a major priority as well, especially when it comes to produce. All produce is date coded, and purchased from suppliers that meet specific safety standards. One such supplier, Wild Rocket Foods, has set new standards in good agricultural practice, promoting sustainability and minimizing risk for raw products. They do this by focusing on all elements of the supply chain and designing their processing facility from scratch.
The result is the kind of traceability Tesco is known for in the United Kingdom. James Truscott, VP of Sales and Marketing for Wild Rocket Foods, says one thing that sets them apart from larger retailers is their smaller supply base. Wild Rocket Foods works with a select group of passionate farmers who share their vision and standards, which in turn simplifies traceability. Instead of working with dozens of tomato suppliers, Wild Rocket Foods works with one that they trust inside and out.
“If you’re the guy supplying our tomatoes, you’re the only guy supplying our tomatoes. That means we’ve got quite a tight range of potential sources when it comes to tracing produce from garden to table. So when we do traceability exercises with our intimate group of suppliers, we can expect a response within a few short hours,” says Truscott.
All Wild Rocket Foods produce is stamped with a date code. Some items are stamped with additional codes detailing other items, like the time the product was made. Their system can trace a store bought product right back to the raw material they receive from farmers, and then directly back to the farm. But would this system be as simple in a larger operation? Yes, Truscott says. Even as the Fresh & Easy brand expands throughout the U.S., as many industry experts have predicted, Truscott says their philosophy will remain the same.
“As long as our farmers want to come on this journey with us and continue to provide excellent standards for quality and safety, we will continue to work with them. We may have additional growers as the chain expands, but we would still be operating on a smaller scale in terms of suppliers, so instead of 22 suppliers, we’d have two. Therefore, as we grow, we would expect the same level of traceability that we have right now,” he says.
Wild Rocket Foods approaches produce safety from a risk-based point of view. They use long-term evidence of where problems might arise, rather than applying a blanket approach to all their products. They also focus on customer needs, listening to what consumers are interested in and tailoring their supply accordingly. Truscott says they are trying hard to put fresh unadulterated products on the shelves quickly, carefully and in a sustainable manner.
Brendan Wonnacott, spokesperson for Fresh & Easy, adds, “We spent a lot of time talking to consumers about what they want. Right now, trust and confidence in food are extremely important concerns for the American consumer. Our goal is to promote good environmental practices in our neighborhoods along with a superior, safe product.”
There are eight Fresh & Easy stores now open in Southern California and one open in Nevada. Four more will open in Arizona by the end of the year.
