Monday, March 31, 2008

The London Times: Time to Check the Well-Oiled Tesco Motor?

Tomorrow morning's edition of the United Kingdom's TimesOnline has a commentary piece by business writer David Wighton about Tesco's competitive and other challenges at home in the UK and abroad in the U.S.

In the U.S., as we reported here on Saturday, Tesco's Fresh & Easy Neighborhood Market is taking a three-month pause from opening new stores in order to review the Fresh & Easy format, corporate and store operations, merchandising, supply chain and other key aspects of the business to date.

The first of the current 59 small-format combination basic grocery, fresh and specialty foods' grocery markets opened in late October in Hemet, a city in the Southern California desert region.

In addition to our Saturday report, Fresh & Easy Buzz is full of analysis on the Fresh & Easy grocery markets--from format and store location strategy, to merchandising and marketing. Just look through our archives. [You can read a recent analysis piece, with suggestions on ways of going forward, here.]

At home, as we've also reported, Tesco, which is the UK's largest retailer with about a 33% share of the grocery sales market, is facing increased competition from number-two Asda (which is owned by Wal-Mart), number-three Sainsbury's, and a host of other retailers; including Morrisons (the UK's fourth-largest grocery chain), Marks & Spencer and upscale Waitrose. [Scroll down a bit near the bottom of this link to read two of our pieces about Tesco's competitive challenges at home in the UK.]

Below is the lede paragraph from Mr. Wighton's commentary piece, "Time to check the well-oiled Tesco motor?" in tomorrow morning's TimesOnline.

Could that possibly be the sound of crunching gears emanating from the normally well-oiled Tesco motor? The bold move into the US has stalled and the mechanics have taken the Fresh & Easy vehicle into the garage for a bit of tinkering. Back in the UK, the experiment of selling clothes online has come to the end of the road and may or may not return after some retuning. Tesco says that that was all it ever was - an experiment. Yet it would surely still be running if it had performed better.

To read the entire commentary piece click here. We suggest reading it.

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