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3 players threatened by tesco’s fresh and easy

April 29, 2007

Tesco’s entry into the US market with Fresh and Easy stores is being watched with considerable interest.

The company has clearly done their homework to identify a “Blue Ocean” in the cluttered grocery store space.

Fresh and Easy

There seems to be considerable opportunity for the concept and it could be enough to worry some players in the market.

1. 7-11- Occupies the neigborhood default space. Used for emergencies and impulse shops. Does 7-11’s position diminish when Tesco enters the neigborhood?

2. Trader Joes
– Occupies an interesting niche- focus on value, quality and healthier products. However, lacks the fresh foods that Fresh and Easy promises.

3. Vons– Mall based, not in the neighborhood which places Fresh and Easy at an advantage. Convenience of neigborhood offering, quality of food and lack of clutter could attract Vons customers.

It should be noted that Fresh and Easy’s entry is going to be fairly small scale; it’s picking markets only in Nevada, Southern California and Arizona.

However, Tesco is a financial powerhouse and if the concept appears to be succeeding, it has the potential to accelerate the expansion.

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