FoodLogistics.com |

London: Tesco has opened the doors of its first Fresh & Easy stores in the U.S. Fresh & Easy’s convenience-focused format potentially represents a significant threat to the U.S. food retailing industry as the concept offers smaller stores, easy access, more ready meals and ‘grab-and-go’ items. Rapid expansion across the U.S. will be a key sales driver for the retailer. By 2011, TNS Retail Forward estimates that Tesco could be a $4 billion retailer in the U.S., with 500 stores. And, TNS Retail Forward believes that sales could reach $10 billion by 2015, positioning Fresh & Easy among the top 10 supermarket retailers in the country.

Fresh & Easy’s format fulfills several different shopping modes and occasions including fill-in trips, immediate consumption, ‘grab-n-go’ and quick replenishment. TNS Retail Forward believes Fresh & Easy’s small-size advantage gives it the opportunity to almost double space productivity per square foot compared with supermarket industry averages. The average size of a U.S. supermarket is more than three times the size of Fresh & Easy’s 10,000 square foot stores. TNS Retail Forward predicts that Fresh & Easy could generate sales of $900 per square foot per-store, nearly twice the supermarket average.

“The combination of Fresh & Easy’s smaller stores, self service tills and ready-to-cook meals has direct appeal among U.S. shoppers whose primary concern is convenience,” says Jennifer Halterman, senior consultant at TNS Retail Forward. “There is demand for this type of concept and we expect other U.S. retailers to be watching Tesco closely for ideas on how to tap into this buoyant market. Fresh & Easy’s smaller store size gives it an ideal formula to replicate quickly throughout the United States.”

Fresh & Easy stores also aim at a variety of shopper segments. They attract the value shopper through affordability, as well as the upscale shopper through a gourmet offer. Unique merchandising and marketing tactics also give shoppers inspiration on how to pull together quick and easy meals that appeal to a variety of tastes.

“The biggest driver of the Fresh & Easy philosophy is the prepared foods selection, with stores dedicating a quarter of their ‘fresh’ area to these products,” comments Mary Brett Whitfield, senior vice president with TNS Retail Forward and director of the Retail Forward Intelligence System.