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Tesco Quits Usa Market

In: Business and Management

Submitted By pjon2794
Words 689
Pages 3
Tesco powered into the U.S. with the idea that it could revolutionize shopping for Americans with smaller stores of roughly 10,000 square feet, about one-fifth the size of a standard supermarket.
Fresh & Easy largely failed to capture the imagination of American consumers unaccustomed to British-style ready meals and self-service cash registers.
Many of Tesco's ideas—which propelled the chain to incredible success in Britain—were lost in translation. For example, the stores featured a huge portion of Fresh & Easy own-brand products, even though American shoppers are far more brand-conscious than their British counterparts. The shops also opened in cities where people drive, meaning the journey to a larger supermarket—with all the national brands and a wider selection—was in many cases only a few extra minutes down the road.
She said Fresh & Easy stores are "too clinical," with too much automation, for American tastes. "They didn't have a very clear proposition," she said. "Are they a convenience store? Are they a discount store?
Even without the economic turmoil, the gamble would have been a dangerous one. The U.S. grocery category is saturated with longstanding, homegrown names such as Wal-Mart, Costco, Whole Foods and Trader Joe’s.
Though some shoppers liked the concept of meals that were ready to eat with minimal preparation, there simply weren't enough buyers.
In the American west, most shoppers drive to supermarkets — sometimes just once a week — and look for a broader range of products!
Levinson said Fresh & Easy wasn't unique as a store, and Tesco didn't have time to experiment and work through glitches because of shareholder pressure. The company also underestimated the amount of attention needed to deal with the quickly changing American market, he said.
The chain went with a small format, with stores that were a cross between a...

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