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Earlier today, we visited our first Fresh & Easy store. The specialty grocery chain is the first US market entry by the British retail giant Tesco (OTCPK:TSCDY), which has committed $2 billion over five years to the effort.

When we planned on going, my mother-in-law said “don’t bother.” She said it was like Trader Joe’s, only more expensive. My wife and thought it was somewhere between a Trader Joe’s and a Whole Foods (WFMI), two well-established US specialty retailers. We were also surprised that there was nothing distinctively British about it, with no food items to appeal to expatriates or those who’ve lived in Britain.

Overall, if I’d never seen a Trader Joe’s, I would have thought Fresh & Easy was a nice store. Instead, it’s just a pale imitation — without the hustle & bustle of the loyal TJ’s shoppers spending their dollars.
But then I found that all of this is old news, particularly to readers of the LA Times. A year ago, the LAT headlined: “British food it’s not/Shoppers find Fresh & Easy a blend of Trader Joe’s and Ralphs” (where Ralphs is the local supermarket chain). In April, the LAT speculated the store is 70% below sales targets, and on its one year anniversary, noted that store openings are also behind target. (Since it’s non-union, it even has a hate site organized by UFCW.)

The thing I didn’t get is: why go head-to-head with Trader Joe’s, which has a similar format, but a 50 year head start with 315 stores? TJ’s is headquartered and mainly concentrated in California, so why not start somewhere else, where its presence and footprint are less? If Tesco came in as a less expensive Whole Foods — in places that had never seen a TJ’s — I believe it would have had a more auspicious launch. As it is, unless it buys an established retailer — something it is wont to do — I can only see one end to Tesco’s US ambitions: ignominious defeat.

Disclosure: None
Source: Fresh & Easy Just a Pale Imitation of Trader Joe's