Tim Ashdown Named CEO at Tesco's Fresh & Easy

Breaking News ... Plus Analysis

Tim Ashdown, the former CEO of United Kingdom-based Tesco's Asia operations, who's essentially been running Fresh & Easy Neighborhood Market as its chief operating officer since arriving in May of this year, has been named CEO of the El Segundo, California-headquartered chain, replacing Tim Mason who departed Fresh & Easy and Tesco, where he was deputy CEO and chief marketing officer in addition to being CEO at Fresh & Easy, this week as part of Tesco CEO Philip Clarke's decision to exit the U.S. by either selling the 200-store grocery chain as a whole or in pieces, or if that fails, closing its doors.

Ashdown, who is responsible for the various changes (like testing full-service checkout in two stores) and workforce reduction measures at Fresh & Easy over the last eight months, was named CEO yesterday. The announcement was made to employees at Fresh & Easy's corporate office in El Segundo. Tesco's CEO, Philip Clarke, has been in Southern California this week.

Ashdown's key task as CEO, in our analysis, is to keep Fresh & Easy on life support until Clarke and Tesco's board can, the hope, find a buyer for the chain, which opened the doors of its first store in November 2007. That first store, in Hemet, California, has since been closed, along with 23 other Fresh & Easy units , because it failed to come even close to meeting the weekly sales numbers needed to continue in operation.

Tesco, which truth be known has no idea what to do with Fresh & Easy - and hasn't for a number of years -  has hired the Greenhill investment firm to find a buyer for the chain. Failing to do that, Greenhill, which is also the firm trying to find a buyer for Supervalu, Inc., has been charged by Tesco to come up with other alternatives, which include selling the stores and the massive Riverside, California distribution center (and related campus properties) piecemeal.

Greenhill, which actually has been working on the project for some time, is going to have a difficult time of it. For example, only about 20% (30-40 units) of Fresh & Easy's 200-store base are in the black - and not by much. Additionally, many of those money-losing remaining 150-plus stores are bleeding tons of red ink, so much so that Tesco reduced the operating hours of 30-plus stores earlier this year, as we reported exclusively in Fresh & Easy Buzz.

Ask yourself this: Would you buy a grocery chain with only 30-40 of its 200 stores in the black?

Selling the stores piecemeal will be no easy task either. Only a few of the 200 units have sales of $150,000 or more per-week, for example. A few more are doing around $100,000 in average weekly sales. Still others, the bottom tier, aren't even close to approaching weekly sales of $100,000.

The 850,000 square-foot distribution center in Riverside is also a white elephant, which continues to bleed red ink for Tesco. The campus was built for a chain of 1,000 stores doing at least $3 billion a year in annual sales - and with a profit. There are 200 Fresh & Easy stores. Annual sales is a bit over $1 billion.

The facility is also custom-built for the "Fresh & Easy" way of doing business, logistics and distribution. It should eventually sell, but at a very low price, in our analysis.

Tesco of course wants to sell Fresh & Easy as a whole. Good luck.

As we've reported exclusively, discount grocer Aldi (we're still looking for another publication to do some reporting on what is a major development) plans to enter California in 2013. Aldi has an interest in some Fresh & Easy stores and the distribution center, according to our multiple sources. However we would be stunned were they to buy the entire Fresh & Easy operation, unless they get it at a fire sale price, which is possible.

Discounter Dollar General, which is opening numerous dollar stores and Dollar General Market grocery stores throughout California, Nevada and Arizona - the three states where Fresh & Easy does business - also has an interest in the chain. Again we would be stunned if Dollar General were to acquire Fresh & Easy as a whole. Dollar General has been acquiring vacant buildings for its stores in the three states on the cheap. The discounter also has a distribution center in Bakersfield, so doesn't need the Riverside facility.

Bottom line: We predict Tesco will have no choice but to sell Fresh & Easy off piecemeal; groups of stores and single stores, along with marketing the distribution center individually, or perhaps as a package along with a group of stores.

Tesco also has more than a score of Fresh & Easy locations sitting fallow; some with completed but empty stores, others undeveloped locations. It's nightmare; so many leases for so many fallow properties are out there we suspect many landlords are not getting all that much sleep this week.

There is interest out there for some of the Fresh & Easy stores. For example, more than one commercial real estate agent specializing in retail properties has contacted Fresh & Easy Buzz, seeking information about the chain and its stores. Our take from these interactions is that many retailers out there think they can get some stores for a huge bargain.

We've also been asked questions - looking for an informed and objective third party we take it - from representatives a couple retail chains, who are gleaning information about individual Fresh & Easy stores.

We also know of one party that has proposed a joint-venture of sorts with Tesco. In our analysis, it wouldn't fly.

But back at the ranch in El Segundo, Fresh & Easy's new CEO, Tim Ashdown, who's had a trial by fire since arriving in sunny and recently rain-soaked California in May - we reported his being moved from Asia to California exclusively here [ May 2, 2012: Reshuffling at the Top at Tesco: Retail Chief Adams Leaving Fresh & Easy For Turkey; China CEO Ashdown to Replace Him; Richie to Head China Operations] - has plenty more fire to wade through. We suggest a truckload of own brand, perhaps "Tesco's Finest," fire extinguishers might be a good idea.

Ashdown's biggest task, as we've said, is going to be keeping Fresh & Easy on life support between now and about March-April 2013, which is the time CEO Clark and the Tesco board hope to be able to dispose of Fresh & Easy - one way or the other.

Related Stories

December 4, 2012: The End is Here For Fresh & Easy: Mason Out as CEO; Tesco To Figure Out How to Exit U.S.

December 4, 2012: The End For Tesco's Fresh & Easy is Here

August 8, 2012: Fear & Loathing in the Aisles: Reduction in Hours and Selected Firings Begin Today at 33 Fresh & Easy Stores

July 28, 2012: Fresh & Easy Neighborhood Market Planning Major Renovations at Two California Stores

July 28, 2012: Fresh & Easy Neighborhood Market to Test Full-Service Checkout at Two California Stores

July 26, 2012: Fear and Loathing in El Segundo: Mass Firings, Reduction in Store Hours at 33 Fresh & Easy Stores ... and More

June 4, 2012: West Coast Bound - Aldi USA Headed to Southern California; First Stores to Open in 2013

April 10, 2012: Dollar General's California Dream Becoming Reality

'Eight Isn't Enough': Fresh & Easy Neighborhood Market to Open Ninth 'Express' Store Soon in Palos Verdes Estates, California

Companion Story - March 3, 2012: 'Eight Isn't Enough' - New Fresh & Easy Express Store Planned for Bell, California

Tesco's Fresh & Easy Neighborhood Market is now hiring employees for what will be its ninth Fresh & Easy Express mini-market, at 2201 Palos Verdes Drive West in the Southern California city of Palos Verdes Estates.

The store at Palos Verdes Drive West and Yarmouth Road in Palos Verdes Estates is scheduled to open next month, according to information we have. Fresh & Easy Neighborhood Market hasn't announced the store's opening date.

The 3,000 square-foot (selling space) Fresh & Easy Express store - there are currently seven 'Express' format units open and operating, all in Southern California, with an eighth store in Los Angeles' San Pedro neighborhood set to open soon (see here) - is going into the former family-owned Lunada Bay Market grocery store, which closed in August 2011.

All but a small portion of the Lunada Bay Market, pictured above shortly before it closed in August 2011, will house the ninth Fresh & Easy Express grocery market. [Photo credit: Elizabeth Stanley.] Pictured below is the inside of the Fresh & Easy Express store at La Cienega Boulevard and 18th Street, Los Angeles, which was the first of the 'Express' store to open, on November 2, 2011. [Photo credit: Fresh & Easy Neighborhood Market.]

The former Lunada Bay Market building is around 6,000 square-feet, according to planning documents on file at the City Of Palos Verdes Estates' planning department.

Fresh & Easy will use about 4,500 square feet of the space for the 'Express' market. About 3,000 square feet of that space will be the 'Express' store's selling space. The remaining space will be used for the bakery and back room. The remaining space is being offered for lease by a commercial real estate firm.

The Fresh & Easy Express mini-market will be Fresh & Easy Neighborhood Market's first store in Palos Verdes Estates, which is in Los Angeles County.

Green light for Fresh & Easy Express

Tesco's Fresh & Easy has publicly said its plans with Fresh & Easy Express was to open eight stores as a test, then decide to go forward with additional units based on the performance of the existing eight stores.

However, the grocer is clearly going forward with additional 'Express' units before store number eight opens. The Rancho Palos Verdes store has been in the works for sometime. So has the store in Bell, California.
Additional Fresh & Easy Express stores are set to be opened this year. There are also more units in the planning stages.

The story about the Bell, California location linked at top offers details about why Tesco and its Fresh & Easy Neighborhood Market chain are going forward with the micro small-format 'Express' stores, which offer about 2,700 SKUs, including groceries, produce, meats, fresh-prepared foods and non-foods, and small in-store bakeries, in 3,000 square-feet of selling space.

Los Angeles County: Fresh & Easy Express' ground zero

On December 10, 2010, we reported in this story - Fresh & Easy Neighborhood Market CEO Tim Mason Says 70 New Stores Possible in Los Angeles Area - that Tim Mason, the CEO of Fresh & Easy and Tesco's deputy CEO and chief marketing officer since March 2011, said Fresh & Easy Neighborhood market could open up to 70 stores in Los Angeles over the next couple years.

Last year Mason repeated this potential strategy in a July 12, 2011 presentation to the Town Hall Los Angeles civic organization, noting the 70 new store potential in the L.A. region. [Suggested reading - July 12, 2011: Tesco in America: A Few Things Tesco Deputy CEO-Fresh & Easy Neighborhood Market CEO Tim Mason Might (and Probably Should) Say in His Speech at Town Hall Los Angeles Today.]

Four of the seven Fresh & Easy Express stores opened since November 2011 are in Los Angeles County. Additionally, so is the eighth unit, which is set to open soon at Sixth and Gaffey Streets in Los Angeles' San Pedro district. Further, the cities of Palos Verdes Estates and Bell are also both in Los Angeles County, making seven of the 10 initial 'Express' stores Los Angeles County-located.

The grocery chain also has new standard-format (10,000 square-foot) Fresh & Easy stores opening in Los Angeles County this year, including those listed here.

Bottom line: Los Angeles County is ground zero for Tesco's Fresh & Easy Express format, which is something we said it would be over a year ago.

Look for many more of the mini-markets, along with some regular format Fresh & Easy stores, to pop up in Los Angeles County this year and beyond, assuming Tesco can come close to breaking even with Fresh & Easy Neighborhood Market by the end of this fiscal year, which started at the end of February 2012 and runs until the end of February 2013, as CEO Philip Clarke says it will.

Related Stories

[Readers: You can read past stories and analysis focusing on Fresh & Easy Express, beginning with our January 2011 report in which we broke the news Tesco's Fresh & Easy would launch the smaller stores, at this link - Fresh and Easy Express.]

Reader Resources

>Click here for a list of the Fresh & Easy Express store locations.
>Click here to view a list of upcoming Fresh & Easy store openings.
>Click here if you're interested in learning more about the city of Palos Verdes Estates.

Vote of Confidence: Warren Buffett Increases Ownership Stake in Tesco to 5.08%

During an interview on the CNBC business network in November of last year famed investor Warren Buffett was asked if he saw any good long-term opportunities in European equities. His response: "If the price came down on some Tesco, I'd buy some more of that."

Buffett has done just that, following last Thursday's 16% drop in the United Kingdom-based global retailer's stock share price, which was the result of Tesco's issuing of a profit warning due to it poor Christmas season financial results at home in the UK, which accounts for nearly 70% of its annual revenue. [See this story for details - January 11, 2012: Tesco Reports 19.3% Comparable Sales Growth at Fresh & Easy Neighborhood Market For 6 Week Holiday Period.]

On Friday, the following day, Buffett increased his stake in Tesco from 3.21% to 5.08%, at a cost of about £500 million ($774 million), according to a required regulatory filing submitted to government authorities by his Berkshire Hathaway holding company, dated January 13, 2012.

Tesco owns and operates Fresh & Easy Neighborhood Market, which is based in El Segundo, California and has 189 stores stores in California (140 units), Nevada (21 units) and Arizona (28 units).

Tesco is closing 12 Fresh & Easy stores, a story we broke on January 8 (read here) and January 9 (read here). A few hours after we published our January 9 follow-up report, Fresh & Easy Neighborhood Market's corporate spokesperson began calling and e-mailing editors and writers at various publications, ranging from the Financial Times and the Orange County Register to supermarket industry trade publications, announcing the store closings.

Current plans call for Fresh & Easy Neighborhood Market to close the 12 stores by the end of this month to early February 2012.

Buffett's big buy is an important vote of confidence for Tesco following last week's big decline in its value. After all, when it comes to investing, he is regularly referred to as "The Oracle of Omaha."

Buffett, who also owns around $2.5 billion of Walmart Stores, Inc. stock, particularly likes Tesco's growth prospects in Asia, and most particularly the future growth opportunities afforded the global retailer in China, where CEO Philip Clarke is putting a major focus.

Prior to taking over as CEO from Terry Leahy in March 2011, Clarke was in charge of Tesco's Asian and European operations, along with heading up the retailer's corporate information technology efforts.

It is a stretch though to suggest Buffett's increased stake in Tesco is a specific vote of confidence for its money-losing Fresh & Easy chain in the U.S., however, because the legendary investor has as recently as late last year voiced serious concern over the enterprise.

It is fair to say though that Buffett is bullish enough on Tesco as a whole that he would increase his stake in the company by such a significant amount even though he harbors such concerns over the U.S. chain.

The "Sage of the Plains," another nickname for the man from Omaha, is a long-term value investor. So buying when he did, when Tesco was down by such a significant percentage last week, is classic Buffett. In other words, based on his proven research methods and track record, he knows a deal when he sees one. Buffett's seldom wrong.

But Tesco does face some big challenges, both at home an abroad.

It's competitors in the UK are getting much better and bigger, for example. And Tesco's focus on price-focused promotions, such as its recent 'Big Price Drop" promo, which is being called the "Big Price Flop" in the UK, aren't working so far.

Globally Tesco is focused on breaking even with Fresh & Easy by the end of its 2012/13 fiscal year, which ends in February 2013. It's not going to literally break even by then, in our analysis. And even if it does somehow achieve that objective by closing stores and cutting costs it must figure out a strategy to make its Fresh & Easy chain not only less of a financial drain but also a real contributor and asset to group Tesco.

But for now, in terms of Buffett's vote of confidence in Tesco, "Every Little Helps."

Related Stories

June 24, 2010: Warren Buffett Strikes Again: Buys 2 Million More Shares of Tesco Stock For 3.2% Ownership Stake

March 3, 2010: Mr. [Tesco] Three Percent Warren Buffett Still Has That 'Oracle' About Him

March 1, 2010: Warren Buffett, 'The Oracle of Omaha,' Wants you to shop at Tesco...But He Doesn't Mind if You Shop at Walmart

February 28, 2009: Warren Buffett: 'Our Country Has Faced Far Worse Travails': A Paralyzing Fear Has Engulfed the Country. But America's Best Days Lie Ahead.'

See addditional related stories at these links: Berkshire Hathaway, Warren Buffet, Warren Buffett and Tesco.

[Illustration credit: The ink-on-paper illustration of Warren Buffett at the top, titled 'The Oracle of Omaha," is coutesy of artist Andrew Mitchell. You can learn more about his work at his site here.]

Tesco CEO Philip Clarke Says His Personal Breakthrough at Tesco Was as its Sausage Buyer Nearly Two Decades Ago

Fresh & Easy Buzz Editor's Note: Tesco group CEO Philip Clarke (pictured above), who was named to the top spot at the United Kingdom-based global food, grocery and general merchadise retailer in March of this year, spoke at the annual IDG Convention held today in London. 

Prior to taking over as CEO from Terry Leahy, who retired in March after leading Tesco plc for 14 years, Clarke, 50, who joined the company over three decades ago as a part time stock clerk while still in high school, was in charge of the retailer's European and Asian retail operations, as well as its corporate information technology function.

Tesco, which is the third-largest retailer in the world after number one Walmart Stores, Inc. and number two Carrefour of France, currently operates 5,380 stores in 14 countries, including 182-store Fresh & Easy Neighborhood Market, which is based in El Segundo, California. The United Kingdom-based retailer has nearly 500,000 employees worldwide.

The topic of Clarke's speech today was: 'Breakthroughs' - describing how the three t's - Technology, Team, Talent - drive change.

Below is what Tesco CEO Philip Clarke had to say today, in his own words:

“Breakthrough” is a word that most people usually associate with science or medicine. A new cure, a new technology that will transform our lives. Retailing, shopkeepers – what breakthroughs have they ever achieved?

Well just think about that for a moment. Refrigeration, the bar code, the milk carton, the supermarket itself: retailers and suppliers have taken new technology – or developed our own –and transformed not just our industry, but our customers’ lives.

Many of you here today – including the IGD itself – have played a major role in this. And I’d like to think that Tesco has done its bit.

Clubcard, our focus on the customer, new formats, new ranges and services – over the years we too have helped shaped the landscape of retailing by breaking through into what were “no go zones” for supermarkets.  

All these breakthroughs, whether at Tesco or elsewhere, are often sparked by a new piece of technology. But I want to argue today that breakthroughs depend on more than just technology. They rely on two more t's:  on teams and talent.

These three Ts – Technology, Team, Talent – drive change. Take one away, and you are unlikely to achieve real, lasting breakthroughs. Create new technology, uncork talent, mix in a strong team, and you have a powerful recipe for change.

Tesco’s strategy today: the challenge of new retailing

During my time at Tesco I have seen the full impact that breakthroughs – some our own, others not – have had on our company. Today we are international, multi-format, multi-channel, a retailer of services, not just food or non-food: Tesco has changed dramatically. And that is largely because we have been strong in terms of technology, team and talent.

To reflect just how much Tesco has changed, I announced earlier in the year that we were going to refresh our strategy. The change is not dramatic, not lurching from one plan to another: it is sensible, careful and thought through.

There is, of course, one thing that will never change. Our world will always revolve around the customer – the customer’s wish for value, range, service, quality. These remain fixed points in our world. All of us here today know that we must deliver on these things or our businesses will fail. So Tesco’s core purpose, to create value for customers to earn their lifetime loyalty – that does not change.  

But we need to respond to the challenge of what I call “new retailing” – the new challenges created by globalisation and the digital revolution, twin forces that accelerate change, increase competition and raise still further the importance of brands. We must show that we are on customers’ side, that we are here to make their lives that bit easier, that bit better.

Embracing new technology

This means embracing new technology. Most of our customers now make little distinction between shopping online and shopping in store. The same must apply to a new retailer. Tesco was the first large retailer to enter the world of the internet. That required a monumental effort in terms of creating new processes, sometimes entirely from scratch, to get customers’ orders to their doors on time. We’ve gone one stage further, and begun click and collect services – so people can order online and then pick up in store.

Now we are going one stage further still. Tesco Homeplus in South Korea has created the world’s first virtual store in the Seoul subway to help time-pressed commuters shop on the go using their smartphones. The walls of the subway station in downtown Seoul are covered with virtual displays of over 500 of the most popular products with barcodes, which customers can scan using the Homeplus app on their smartphones and get delivered right to their doorstep. 

Busy commuters can scan their groceries on their way to work in the morning and, as long as their order is placed before 1pm, their shopping will be delivered home that same evening, creating even greater speed and convenience in the whole shopping experience.

That’s the kind of breakthrough that really transforms people’s lives – and quite possibly our industry.  It relies on state of the art technology – and carefully thought through systems, in which every process is thought through, every person knows exactly what he or she is meant to do. Which brings me to the other two Ts – team and talent.

Team and Talent

As a business that employs almost half a million people, obviously team and talent are critical to Tesco.  They’re so important that I have added to our strategy a clear goal: to build our team so that we create more value than any other. As our business continues to grow and diversify, we need more leaders to run the many, substantial business and support functions within the Group. Our leaders not only have an important role today, but also have a responsibility to help build a bigger and better team for the future.

I know what you may be thinking: we are facing one of the toughest trading conditions this country has seen for decades – what relevance has this to the here and now?

The truth is, though, that it is in such turbulent times that your team is tested the most. It’s in a storm, not calm waters, when a crew is really challenged. That’s why our team matters so much today.  Can we change to meet the new conditions? Have we the stomach for the fight in ever tougher markets? Can we continue to innovate, to stay ahead of the pack, helping our customers as they struggle to make ends meet?

The answer is yes. In the last month here at home we have made the biggest change to our pricing and promotions strategy in many years, investing over £500m in reducing more than 3,000 prices, as well as simplifying and deepening our promotional discounts. We’re absolutely committed to doing what we can to help customers by cutting prices on the nation’s shopping list – the things families buy most often and where it will make the most difference.

It has already been a huge team effort – a 14,000 strong Tesco army worked a total of 90,000 hours on the Sunday we launched The Big Price Drop, changing almost 3 million price labels on shelves up and down the country.   It’s a strong team especially when times are tough.

But there is another reason I care so much about building the team and fostering talent – a personal reason.  I owe a lot to Tesco – it’s given me fantastic opportunities in life. My father ran a Tesco store extremely well - but he didn't have the confidence that training brings to do more than that. I’ve been lucky enough to have that training. In my twenties, working at Tesco, a regional director taught me about process and systems.

Then there was the store manager for whom I worked who taught me about leadership; the new store opening director who taught me about multisite management; John Bird, who ran retail in the UK, who taught me about trading and the importance of cherishing the products we sell.

And in my thirties I learnt about buying, marketing and strategy from some of the finest retailers in the world. Indeed - my personal breakthrough point was when I was the sausage buyer. That’s why these two t’s – team and talent –matter so much to me. And why the object I have brought today is the forerunner to Tesco's Finest range - a pack of Tesco Traditional sausage, circa 1991.

Let’s start with the basics. A strong team needs a clear purpose – a purpose that endures, that appeals to the head, not just the heart. If the purpose of a company is just to make something, that won’t endure: that thing will probably soon become old and then redundant – consigning the company to history. A company needs to explain how it will help people over time. As I said earlier, our core purpose, written in 1997, remains untouched.

Alongside that sits clear values. Values guide a business - and everyone in it. How they behave, how they respond to change, how they talk to each other and their customers. They need to test one, to give you something to aspire to – as well as being simple to understand. Our values are “no one tries harder for customers” and “treat people how we like to be treated”.

And the third bedrock of a strong team is a clear strategy, so clear and simple that everyone knows precisely why they are getting up and going to work each day, so they know what is a priority, and so they understand what success is.

These three bricks – purpose, values and strategy – are the foundations of a team. They answer the questions “why are we here?” “how are we meant to behave?” and “what is success?” But that is just the start.

Each person needs to know how they fit in to company – and, crucially, what is expected of them. They need to own a task – that means being given responsibility for a task, and be made accountable for its delivery.

Ownership focuses minds – and gives people a sense of pride and respect.

You need to communicate that role in simple ways. Many of you here will know the Tesco Steering Wheel, which sets out responsibilities for the entire business, each store, each team. It helps us drive change, and ensure that the whole business is moving together.

But you cannot simply send out missives from head office. Which brings me to communication: a head office culture, one where people are given orders from anonymous managers on high – this kills strong teams. You need to be out there, on the shop floor, talking to the teams, explaining what’s happening, and their role.

That attitude reflects something else that Tesco has long held dear: we want our teams to take risks. By trying nothing new you stay as you are. You must innovate. Yes, that means making mistakes – but you learn from your mistakes. So initiative, risk taking, decentralisation, giving each person the encouragement and freedom to innovate and suggest new ideas – these are critical.

New steps we’re taking to foster talent

These basic principles have guided our approach to building strong teams for over a decade. Our new focus on our team, now part of our strategy, will turbo charge our efforts, and help us embrace new technology.

Recognising the simple, obvious fact that we are a people business – run by people, for people – I want everyone to shoulder a responsibility for fostering talent. That means we need to adopt three additional basic principles to team and talent.

First, an end to thinking in silos, to saying that “recruitment, training –that’s not my job”. Talent spotting, performance reviews, career discussions: these will become critical tasks for the entire Tesco team.

Second, if we are to retain talent, we need to reward talent. For Tesco that means competitive pay at all levels, an opportunity to share in our profits through shares in success, and bonuses linked to performance for all senior managers. More importantly, our people are rewarded through opportunity – at any one time 7,000 members of our UK team are on development programmes specifically designed to help them gain the experience and skills they need to move on to the next Tesco challenge. Little wonder that 80% of our management roles are filled internally.

Third, related to that, we want to nurture our talent so that everyone feels that their best days are yet to come. This is a goal shared by the entire Tesco team, including our partners at USDAW, the trade union with whom we have an industry leading relationship. Nurturing talent means career plans, so everyone knows where they are going, and the type of jobs they need to do to gain the experience and skills to get there. And it means succession plans for jobs: we always have 2 successors identified against our top 500 jobs.  

And we’re investing in training. Here in the UK there's a training scheme for every major career stage at Tesco, from core skills training to Apprenticeships and Retail Degrees, which is another of the reasons why around 80% of our management roles are filled by existing team members. This year we’ll also have a record 420 graduates starting our UK graduate programmes. Overseas we’re recruiting around 600 graduate trainees and in Asia, we’ve invested £30m in our newly opened training academy in South Korea where 24,000 people will be trained every year.

Why this matters

Why does this matter so?

We’re now a global business, and we need a world class team if we are to win and to compete. We don’t simply need to attract talent, we need to motivate and retain it. That’s why I spend so much time – I reckon about three quarters of my time – talking to the team, hearing about what they are finding on the shop floor, helping them improve their performance.

Some of you may think “surely this is not a priority now?” Well, let me stress what I said earlier: when tough times hit, it is even more important to be motivating your team, building that team, helping it overcome the hurdles they face. Some of those challenges are practical – others relate to morale: both are important.

And, finally, I care about building our team because of what I said earlier: my own background. Tesco gave me a chance to get up and get on in life. It’s given that chance to many hundreds, if not thousands of people. It is proof that supermarkets are not just an example of business breakthroughs – but social breakthroughs. For our company – like others here today – is an engine of social mobility, helping people realise their ambitions and dreams. And that’s perhaps the best breakthrough anyone can ask for.

Conclusion

So, to conclude where I began, breakthroughs rely on teams, talent and technology. Embrace the technology, build the team, foster talent. Obviously get the processes, the IT, the systems right. But never forget the basics that govern people: a clear purpose, a set of values, a well understood strategy. Never stop talking to people, make them own their responsibilities, and encourage them to take risks. And then make it everyone’s responsibility to nurture talent, to train and to reward teams – so that they always are looking up and moving forwards.

That’s how we have delivered breakthroughs at Tesco –and how I plan to continue to do so in the future.

Thank you for listening.

- Philip Clarke.

Tesco Reports First Quarter Comparable Sales Growth of 11.1 % For Fresh & Easy Neighborhood Market

The next new Fresh & Easy store Tesco will open is the unit at 32nd and Clement in San Francisco, pictured above. The Fresh & Easy market, Tesco's first in the city, opens June 22.

News/Analysis

United Kingdom-based Tesco plc today offered a sales percentage-focused summary report for the first quarter of its 2011/12 fiscal year, which began February 27, 2011 and ended May 28, 2011, including listing sales growth percentages for its Fresh & Easy Neighborhood Market chain in the Western U.S.

Tesco said overall sales at Fresh & Easy were up 21.9% (31.7% at constant exchange rates) and same-store or comparable-store (called like-for-like sales in the UK) sales at Fresh & Easy Neighborhood Market grew by 11.1% for the quarter.

Comparable-store-sales at Fresh & Easy Neighborhood Market were plus-8.6% in Tesco's fiscal year 2010/11 fourth quarter, which ended February 26, 2011.

Additionally, Tesco reported a 9.4% gain in comparable-store-sales at Fresh & Easy for its 2010/11 fiscal year, over the previous fiscal year (2009/10).

The continued growth in comparable-store-sales is a good trend for Tesco with its Fresh & Easy chain because the metric measures sales at stores open at least one year, which means it doesn't include sales growth from new stores opened during a given quarter.

Tesco had 175 stores open at the May 28 first quarter 2011/12 fiscal year-end.

There were 164 Fresh & Easy fresh food and grocery markets open and operating at the February 26, 2011 end of the 2010/11 fiscal year.

Today's reported 21.9% gain in overall sales for Fresh & Easy Neighborhood Market includes those new stores opened between March and May 28, 2011. All 11 of the new stores were opened from March 2 to the end of April 2011.

Tesco didn't open any new Fresh & Easy units in May 2011.

It plans to open one new Fresh & Easy store this month. That store, the first unit in San Francisco, is set to open June 22.

We broke the news about the store's opening date in this May 10, 2011 story: Breaking Buzz: Fresh & Easy Neighborhood Market Plans to Open First San Francisco Store at 32nd and Clement June 22. Tesco's Fresh & Easy confirmed our reporting 13 days later. See - May 23, 2011: Fresh & Easy Neighborhood Market Confirms Our Reports First Two San Francisco Stores to Open June 22 and August 24, 2011

As we've written about previously, although the comparable-store-sales growth trend at Fresh  Easy is a positive one for Tesco, in our analysis it needs to be noted that part of the reason for the significant growth is due to the retailer's continued use of its 10% -to- 25%-off discount coupons, which Fresh & Easy Neighborhood Market has been distributing on a chronic basis since 2008, with only a break of a couple months in 2009.

For example, Fresh & Easy Neighborhood Market has had one or more of the store coupons, which allow shoppers to take deep-discounts off their total purchases - $5-off-$25, 6-off-$30, $10-off-$50, ect., for example - in distribution essentially at all times during the first quarter of this year, posting the vouchers online and distributing paper coupons each week in its advertising circular, along with sending out special coupon books (particularly in Northern California) that contain even more coupons.

As such, we won't get a "real" comparable-store-sales metric from Tesco for Fresh & Easy until it stops using the discount coupons as a regular part of doing business rather than in a promotional manner, which means far less frequently.

Ask yourself this: What if Walmart, Kroger Co. or Safeway Stores, for example, all had 15% -to- 25% off coupons in distribution nearly everyday during each of its respective first quarters Would you not expect each of those chain's comparable-store-sales to be higher due to the artificial lift provided by the chronic use of the vouchers? Any reasonable person would answer yes.

Using the coupons even as frequently as once or twice per quarter is promotional. Distributing the coupons the way Fresh & Easy does - chronically - is an artificial sales-lifter.

And in Fresh & Easy's case, since it has a whopping negative-38% margin, as reported in February of this year, we suggest Tesco would stop using the coupons so regularly if it was confident it could have the same or even similar comparable-store-sales without them.

Tesco doesn't report actual sales and profit/loss numbers, or margin figures, in its first quarter statements.

However, as you can read about here, the retailer continues to lose a substantial amount of money on Fresh & Easy, despite CEO Philip Clarke's pledge to break-even with the chain of 175 stores located in California, Nevada and Arizona by the end of Tesco plc's 2012/13 fiscal year, which is only 21 months away.

As noted above, Tesco also reported a negative 38% margin for Fresh & Easy for the 2010/11 fiscal year.

Based on our reporting and analysis, we haven't seen any indication at Fresh & Easy that would lead us to believe Tesco's first quarter loss was significantly better on a percentage basis than what it reported in April 2011 for the 2010/11 fiscal year.

Additionally, based on its continued chronic use of the discount coupons - Fresh & Easy eats the full-percentage discount (15%, 25%, ect.) with the coupons, which goes to margin loss - along with pricing and general heavy competition in all its markets, we also doubt there's been a significant improvement in the negative 38% margin at Fresh & Easy Neighborhood Market.

But the first quarter double-digit comparable-store-sales growth is a positive indicator for Fresh & Easy, even though in our analysis it reflects the artificial sales lift provided by the chronic use of the margin-killing store coupons.

Our conservative estimate (and it's just an estimate based on our coverage of the chain) is that about 25%-30% of Fresh & Easy's 11.1% comparable-store-sales growth for the first quarter can be attributed to the chronic use of the coupons, which would mean a more "real" comparable-store-sales growth percentage for the first quarter would be about 8.5%, which is still positive.

But retailers can discount all they want to achieve whatever comparable-store-sales numbers they're after - or hope to get. So 11.1% is what it is, the reported percentage growth achieved for the quarter at Fresh & Easy Neighborhood Market.

But in order to break even with Fresh & Easy, Tesco has to start losing a whole lot less money, pure and simple.

Therefore, among other things, that will require achieving a far better than negative 38% margin, regardless of comparable-store-sales growth numbers.

Tesco CEO Philip Clarke also said today the 11 Fresh & Easy stores in Northern California "have started strongly, with weekly sales per store of $150,000 in their first quarter. We assume he means the $150,000 in average weekly sales is a blended average of all 11 stores, since we know directly of more than one store in the region that isn't doing $150,000 a week in sales.

Sales in the Northern California stores - the first two units opened March 2 and the last batch of stores at the end of April - are being greatly aided by very heavy discounting in the form of the deep-discount store coupons, as we reported in this March 21, 2011 story: Fresh & Easy Neighborhood Market Flooding its Northern California Store Neighborhoods With Margin-Busting Store Coupons. The discount coupon blitz in Northern Caifornia has continued since then to today.

Tesco reported an overall sales increase of 7% for its UK business, which represents nearly 70% of its global sales.

Comparable-store sales (like-for-like) in the UK were flat though at 1.0%. And when non-gasoline sales and the UK's value-added tax are factored in, Tesco's first quarter like-for-like sales were negative, as you can see in the chart at the link below.

You can view Tesco plc's first quarter management statement here. It includes a sales percentage breakdown for all of Tesco's operating divisions in Europe and Asia, as well as at home in the UK, and its Fresh & Easy chain in the U.S.

Related Stories

April 19, 2011: Tesco's Fresh & Easy Neighborhood Market Posts Biggest One-Year Loss Yet - $307 Million Loss on Sales of $818 Million

March 21, 2011: Fresh & Easy Neighborhood Market Flooding its Northern California Store Neighborhoods With Margin-Busting Store Coupons

December 7, 2010: Tesco Reports Solid Third Quarter Same-Store-Sales Growth For Fresh & Easy Neighborhood Market

October 5, 2010: Philip Clarke's Early Welcome to America: Tesco Logs $151 Million Half-Year Loss For Fresh & Easy Neighborhood Market

October 4, 2010: Tuesday's Tesco Interim Report Offers A Road Map of Sorts For the Future of Fresh & Easy Neighborhood Market

April 20, 2010: Strong Group Revenue & Profit For Tesco... But $253 Million Loss at Fresh & Easy

April 19, 2010: Tesco Reports Fiscal 2009 Results on Tuesday, April 20; Estimated $250-$259 Million Loss For Fresh & Easy

April 21, 2009: Tesco PLC Reports Record Sales and Profits; But Takes £142 Million ($208.05 Million U.S.) Loss For Fresh & Easy Neighborhood Market USA

April 20, 2009: Tesco to Report Full-Year Financials Tomorrow; We Estimate £110-£150 Million Full-Year Loss For Fresh & Easy Neighborhood Market

September 30, 2008: News & Analysis: Tesco Reports Half-Year Financials; Reports Loss For Fresh & Easy USA and Sales Per Square Foot Averages

September 29, 2008: Tesco PLC to Report Interim Financials Tomorrow; Including Guidance on Fresh & Easy Neighborhood Market USA

September 26, 2008: Tesco PLC, Fresh & Easy and the Numbers Game; Will Tesco Release Hard Numbers For Fresh & Easy Next Week? If So, Will They Be Meaningful?

Tesco launches New Corporate Website - We Suggest it Needs to Go Back to the Design Lab For Version 2.0

Corporate Identity & Image: Analysis/Opinion

United Kingdom-based Tesco plc, which owns 175-store El Segundo, California-based Fresh & Easy Neighborhood Market, has launched a new corporate website. [See the site here.]

The new, more modern-looking website features Tesco's trademark blue red and white colors, replacing the global retailer's "old grey lady-style" utilitarian site, which was functional but lacked a look reflecting the trend in corporate websites today, which is to offer bolder colors and graphics, along with increased links and features, although it's our analysis and opinion the new website isn't an overall improvement over the previous version.

Among the new features of the corporate website are links on the home page to Tesco's various global retailing chains, under a headline that says: "Tesco in your country."

The menu features links to the 14 countries where Tesco has it retail divisions. When you click on a country link, such as USA, you're taken to the website for that particular chain, which in this case is Fresh & Easy Neighborhood Market. The new feature is a plus, in our analysis and opinion.

In addition to the traditional corporate website links like "about," "press" and "investors, Tesco's new online home also has a clearly-marked link at the top to it's Tesco.com online retail store website.

The new website also offers a couple additional features the old version didn't have, such as expanded corporate history and corporate responsibility sections.

Other than the additions mentioned above though, the site is nearly identical to the old corporate online home in terms of information content and functionality.

The launch of the new corporate website comes in conjunction with Tesco's release on May 31 of its annual report and announcement that its annual shareholders' meeting will be held July 1, 2011.

The just-out annual report features a discussion of Tesco's new executive-director compensation plan, which among others things will change the way Tim Mason, CEO of Fresh & Easy Neighborhood Market, and as of March 2011 Tesco group deputy CEO, is given bonuses and stock incentives.

We'll have a story about the new plan and it's affects on Mason and the other directors upcoming in Fresh & Easy Buzz.

In our analysis and opinion the new corporate website is a bit amateur-looking for Tesco, which is the world's third-largest global retailer, after number two Carrefour of France and U.S.-based Walmart Stores, Inc.

For example, take a look at the font style in the body of the website on Tesco's new website. The fonts look more hobbyist design-oriented rather than of a professional website design, in our opinion.

Additionally, we find the investor and press features a bit slow to load and to use, compared to corporate websites from major retailers like Walmart, Carrefour, Target, Safeway Stores and others. And look at the special website (here) Walmart has set up for its annual meeting tomorrow. It's very impressive, smart and useful.

We also can't find any links to social media - Facebook, Twitter, ect. - on the new Tesco corporate website. Can you?

This is a major omission because one of CEO Philip Clarke's main initiatives since taking over from Terry Leahy in March of this year has been and is to increase Tesco's use of social media, which he has and is doing. But you can't tell that from the new corporate website. A corporate website is the perfect place to list and integrate a retailer's social media efforts. Tesco's new site flunks big time in that regard.

For example, there's a section on the website called "Multimedia Library," which one would think would be a logical and good place to share Tesco's various social media offerings with users. But ... there's nothing there.

We suggest Tesco take a look at Walmart's website, for example, which not only looks far superior to the United Kingdom-based global retailer's new site but also offers many more functions, including an excellent section detailing the Bentonville, Arkansas retailer's social media sites.

Tesco's new site is brighter and bolder than the corporate website, without a doubt.

But we suggest CEO Philip Clarke should tell his web designers - and have a talk with the executive who signed off on the site going live - to take a look at similar sites offered by Walmart and other big retailers, then instruct them to go back to the design lab and create version 2.0 of the new Tesco corporate online home, a website that better fits Tesco plc's status as the world's third-largest global retailer.

Hopefully the site is in Beta test mode, although we don't think that's the case.

Tesco does have a food-oriented website, Tesco Real Food, which we think it does a good job with.

But the site is separate and distinct from and serves different purposes and functions than its corporate website.

But what about some integration? We can't find a link on Tesco's new corporate website to its Tesco Real Food site, can you? Nor do we see a link on Tesco Real Food to the corporate website. (And if there is one it means it's so poorly located we couldn't see it. And we looked closely)

This omission is a real failure to integrate. After all, there are numerous synergies Tesco could utilize between the two websites. Such a thing is really basic marketing 101 (or at least 102) stuff. Perhaps Tesco should have let a coupe university interns check out the site before going live with it.

A retailer's online image via its website is perhaps today its most-important corporate identity tool along with its brick-and-mortar stores. We suggest the identity and image conveyed by Tesco's new corporate website is far from one befitting the world's third-largest global retailer.

Richard Broadbent to Join Tesco's Board July 2; Become New Chairman November 3

United Kingdom-based Tesco, which owns 175-store El Segundo, California-based Fresh & Easy Neighborhood Market, announced today Richard Broadbent (at left) will become the global retailer's new board chairman when current chairman of the board, David Reid, retires in November 2011.

Broadbent, who is currently deputy chairman at Britain's Barclays Bank, will join the Tesco's board as a non-executive director on July 2 of this year and will become chairman on November 30, Tesco said today in announcing the change.

Tesco and Reid, who's been on the retailer's board since 1985, had previously announced the current chairman's retirement, saying he would be leaving his position this year.

Reid is also a non-executive director of the Reed Elsevier Group and board chairman of two other companies in the United Kingdom - Kwik-Fit Group and Whizz-Kidz.

Like Reid, Broadbent will be a non-executive (or independent/outside) director and then chairman of Tesco's board of directors, meaning he isn't employed by Tesco plc.

Broadbent, who like former Tesco CEO Terry Leahy who retired in March was given the honorary title "Sir" by the Queen of England, will step down as Barclay's deputy chairman and senior independent director upon assuming the board chairmanship at Tesco in July, according to Lucy Neville-Rolfe, executive director of corporate and legal affairs at Tesco. Rolfe is also a member of Tesco's board.

Tesco currently has a 16-member board of directors. The board is a mix of executive (Tesco senior executives) and non-executive (outside) directors.

Among the Tesco corporate executives on the board are CEO Philip Clarke and deputy CEO Tim Mason, who's also CEO of Fresh & Easy Neighborhood Market, and lives and works in Southern California.

When Richard Broadbent assumes the board chairmanship of Tesco July 2, it will complete the global retailer’s changing of the guard at the top, which began in March when Philip Clarke, Tesco’s former head of Europe and Asia retail operations and chief of corporate information technology, took over as CEO from Terry Leahy.

Additionally, Tim Mason was named Tesco's deputy group CEO in March. He retains his title and position as CEO of Fresh & Easy but has added a few corporate responsibilities to his portfolio, including branding and Tesco's global climate change initiative.

CEO Philip Clarke Launches A New 'Vision and Strategy' For Tesco

News & Analysis

Philip Clarke (pictured above), the new CEO (as of March 2011) of United Kingdom-based Tesco, which owns El Segundo, California-based Fresh & Easy Neighborhood Market and is the third-largest retailer in the world, is launching what he and Tesco are calling a new "Vision and Strategy for Tesco."

The new aspirational and strategic blueprint for Tesco lays out four key elements that comprise the global retailer's new "vision," along with seven key strategic elements that flow from the vision statement.

"We [Tesco] have a great business and I've been impressed by the very positive momentum which I have noticed over the past couple of months," Clark said today in introducing the new vision and strategy for Tesco, which has retail operations in 14 countries. "I expect the pursuit of our new vision, together with the application of our strategy, will make us even more successful in the years ahead," he added.

"Our previous strategy served us well for over a decade but we've updated it to reflect the changing needs of our customers and the global nature of our business. Much of it will be familiar but there are some important new additions," Clarke says.

"To help us achieve our ambitions, we need to keep focused on our Core Purpose - to create value for customers to earn their lifetime loyalty. This will remain at the centre of everything we do and together with our Values provide the framework for the way we do business and let customers know what to expect from us. Our success depends on all of us living the Values every day."

Clarke says now that he's the CEO of Tesco there won't be any changes of direction. But there will be a slight change in emphasis.

That change will be to put a greater emphasis than Tesco has in the past on becoming a multi-channel retailer.

"Tesco's always had a good relationship with customers at the store level. That relationship now has got to be a multi-channel relationship", Clarke says. "We've got to use all the media that's available to use to allow us to build a dialogue so Tesco goes from being a business which is respected by many to on that's admired."

One of Clarke' major initiatives since assuming the CEO position at Tesco in March has been to expand the use of social media, along with starting to make its use an integrated aspect of the global retailer's operations, marketing, communications and merchandising.

For example, while still in his previous position at head of European retail operations and corporate information technology, Clarke launched his own Twitter feed, which he uses primarily to communicate with Tesco executives and other employees throughout the world, including his deputy CEO Tim Mason, who's based in Southern California and is also the CEO of 175-store Fresh & Easy Neighborhood Market.

Shortly after becoming CEO in March, Clarke had senior executives at Tesco's corporate headquarters in the Unite Kingdom and at its various outposts in Europe, Asia and the United States, set up their own Twitter accounts.

So far some of the executives are using the accounts; a few regularly, others every so often. But many of the executives have yet to post an initial tweet. Clarke and Mason, however, average at least one Tweet per day during the work week.

Clarke, who went to work for Tesco stocking store shelves part time at age 13 and climbed the ranks to become CEO over what's now a near-four decade career at the company, replacing Terry Leahy who retired in March, says the new vision is for Tesco to be:

• Most highly valued by the customers we serve, the communities in which we operate, our loyal and committed staff and our shareholders
• A growth company
• A modern and innovative company
• Winning locally, applying our skills globally

The new strategy at Tesco that flows from its new vision, says Clarke, is described by the following eight bullet points:

• To grow the UK core
• To be an outstanding international retailer in stores and online
• To be as strong in everything we sell as we are in food
• To grow retail services in all our markets
• To put our responsibilities to the communities we serve at the heart of what we do
• To be a creator of highly valued brands
• To build our team so that we can create more value

As part of his introduction of Tesco's new vision and strategy, Philip Clarke, who's already made at least two trips to the U.S. - one in February, before officially becoming CEO, and another in April, to meet with employees at Fresh & Easy's El Segundo, California headquarters and visit stores, along with visiting major Tesco investors in places like Omaha, Nebraska where Warren Buffett, who's Omaha-based Berkshire-Hathaway firm owns about 3% of Tesco, lives and works - has made a six minute video outlining he vision and strategy points detailed in this story. You can view the video here.

Launching the new vision and strategy for Tesco, however similar it may be to the current vision and strategy with a few key additions, is also an important coming out event for CEO Clarke. Terry Leahy, who during his 14-years as CEO became so associated with Tesco that people often called him "Terry Tesco," became a legendary retailer in the United Kingdom.

In other words, Sir Terry, a title given him by the Queen during his tenure as CEO of Tesco, is a hard act to follow, not only for Philip Clarke but for anybody assuming the corner office at the Tesco corporate campus in England.

Launching the new vision and strategy just slightly more than two months after assuming the CEO position should allow Clarke to put his imprint on Tesco early on, demonstrating he has his own leadership style and, while having worked under Sir Terry for many years, has his own vision for the global retailer rather than his tenure at the top being a mere continuation of the Leahy years, although the continuity - which is something very important at Tesco - is obviously there.

Fresh & Easy Neighborhood Market-Sponsored Pro-Am Golf Tournament Raises $200,000 For Youth Programs

Tesco's Fresh & Easy Neighborhood Market and its partners raised $200,000 for LA’s BEST (an after school program for kids in Los Angeles) and Park Century Schools at the fresh&easy Dinah Shore Charity (LPGA) Pro-Am golf tournament which was held yesterday on the Arnold Palmer course at Mission Hills Country Club in Rancho Mirage, California, according to Tim Mason, CEO of Fresh & Easy and group deputy CEO of United Kingdom-based Tesco.

The inaugural fresh&easy Dinah Shore Pro-Am golf tournament was part of the larger Kraft Nabisco Championship 2011, held at Mission Hills from March 28 -to- today, April 3. The long-running Kraft Nabisco Championship event celebrated its 40th anniversary this year.

Fresh & Easy Neighborhood Market became the name-sponsor of the event after CEO Mason was approached by veteran professional golfer and LPGA member Amy Alcott earlier this year.

"From the moment Amy discussed the concept of this event with me, I could see her desire to put a spotlight on the 40 wonderful years of the players and milestones of the Kraft Nabisco Championship as well as to create an opportunity to help children in some way, our shared passion. To now see the support of these great players – hall of famers, tournament champions, LPGA legends – continues to strengthen our commitment to the event, which also gives us a tremendous opportunity to raise important funds for LA’s BEST and Park Century Schools, two very worthy beneficiaries," Mason said in February about Fresh & Easy's sponsorship of the golf tournament.

Alcott and Mason headed up the organization of the pro-am tournament, which paired LPGA professionals with amateur golfers, including Fresh & Easy's Mason, who reports his team placed third in the event.

The lady-professional golfers participating in yesterday's tournament were, in addition to Alcott: Donna Andrews, Susie Berning, Jane Blalock, Pat Bradley, Donna Caponi, JoAnne Carner, Beth Daniel, Cindy Figg-Currier, Rosie Jones, Betsy King, Meg Mallon, Patricia Meunier-Lebouc, Alice Miller, Liselotte Neumann, Alison Nicholas, Sandra Palmer, Nancy Scranton, Patty Sheehan, Hollis Stacy and Kathy Whitworth, the winningest female golfer of all time.

But the big winners of the golf tournament are the two youth-focused organizations, LA's Best and Park Century School, who will benefit from the monies raised on the links at Mission Hills in sunny Rancho Mirage yesterday.

LA's BEST (Better Educated Students for Tomorrow) is a nationally recognized after school education, enrichment and recreation program. It serves 28,000 children with the greatest needs and fewest resources throughout the City of Los Angeles. The organization's After School Enrichment Program provides a safe haven for children ages 5 to 12 at 180 elementary school sites each day during the critical hours after school, at no cost to parents. Established in 1988, LA's BEST is a partnership between the City of Los Angeles, the Los Angeles Unified School District and the private sector.

Park Century School is a non-profit independent co-educational day school designed to meet the specific educational needs of bright children, ages 7 to 14, who have learning disabilities. The School serves students from communities in the South Bay to the San Fernando Valley and from Malibu to Hancock Park, including the greater Los Angeles area.

Thanks to the Saturday on the greens, the two organizations now have a bit more green to use in support of the kids they serve. Job well done all around.

Related Story

February 16, 2011: Fresh & Easy Neighborhood Market CEO Tim Mason Gets A Major Golf Tournament to Call His Own.

In Twitter Veritas: Tesco CEO Philip Clarke Sets 'The Insider' Straight Via A Tweet

The Insider - Heard on the Street

In my most recent column - March 18, 2011: The Twitter Agenda: Tesco CEO Philip Clarke Meets With the Troops About Social Media - I said the Twitter feed @TescoStores belonged to United Kingdom-based global retailer Tesco, which owns El Segundo, California-based Fresh & Easy Neighborhood Market.

In the column I also asked the question: When will Tesco start tweeting on @TescoStores?

I asked that question because the only two tweets on the feed are from April 2009, when it was set up.

I then offered a prediction that the retailer would start tweeting on the feed no later than to weeks from March 18.

I was wrong on two counts.

First Count: The @TescoStores Twitter feed doesn't belong to United Kingdom-based Tesco, according to CEO Philipe Clarke, who said so in a tweet today.

Second Count: Since I was wrong on the above (the premise), it then follows that my prediction that Tesco will tweet on @TescoStores no later than two weeks from March 18, 2011 is also incorrrect.

Below is today's tweet from Tesco CEO Philip Clarke, addressing @TescoStores:



clarkepatesco



March 22, 2011:"Sorry been rather quiet last few days - family illness. Been asked why @tescostores not tweeted much: would you believe it isn't ours! about 9 hours ago via Twitter for BlackBerry®"

Being the competitor I am, I suppose at the least I still have a shot at the prediction part of my March 18 column being correct, if the person who owns @TescoStores contacts CEO Clarke post-haste and offers to turn over the Twitter feed to Tesco, on the condition the retailer start tweeting on it no later than two weeks from March 18, 2011. Come to think of it, if that were to happen, it also would serve as "column-extender" (think editorial Hamburger Helper) for 'The Insider.'

Silver linings

Despite being wrong on the two counts detailed above, it's good to know my column is being read by people close to Clarke, and that those folks, after reading my March 18 piece, asked the Tesco CEO a mere couple days later "why @TescoStores (has) not tweeted much."

Additionally I'm glad Philip Clarke addressed the topic of my March 18 column in his tweet today. Why? I'd rather make a mistake and learn the why rather than be right but never learn the correct answer.

Therefore I thank the CEO of Tesco for that, vis-a-vis his tweet today. And if the only entity that actually did the "asking" to Clarke was my Friday (March 18, 2011) column in Fresh & Easy Buzz, then I hope he got something more out of reading it, as I hope is the case for all who read it, than just my mistake.

Despite getting it wrong about @TescoStores belonging to Tesco plc, and thus having my prediction invalidated by the faulty premise, had I not done so it's possible we (readers and myself) never would have learned what we learned from CEO Clarke's tweet today.

So I'm actually happier than I normally would be to have been wrong in this particular instance because it's serving as a reminder or simple object lesson for me. That reminder: That as long as you're right most of the time, and in my columns I have been, then it's OK to be wrong every so often - particularly if you take a bit of a risk in being so - as long as you admit your mistake, set the record straight (which I'm doing in this column) and learn from the experience, even if its a minor mistake and experience like a column about Twitter feeds and related subjects.

After all, there's always a silver lining in life and in business, if you allow yourself to be open to discover it and learn from it. I want use that worn out phrase "teachable moment," however, even though I suppose I just did.

Meanwhile, to the owner of @TescoStores on Twitter, you can tweet your offer to give the @TescoStores Twitter feed to Tesco CEO Philip Clarke at: @clarkeptesco.

And to the owner of the Twitter feed, I ask just one favor: If CEO Clarke is interested, please make the offer to give him @TescoStores contingent on his agreeing to have Tesco post at least one tweet between now and no later than March 29 on it. After all, my two week prediction clock, which began on March 18, is ticking away. Let's be clear though: It's not like I'm begging.

- The Insider

Related Column: March 18, 2011: The Twitter Agenda: Tesco CEO Philip Clarke Meets With the Troops About Social Media

>Read past columns by Fresh & Easy Buzz's 'The Insider' columnist at the following link - The Insider

The Twitter Agenda: Tesco CEO Philip Clarke Meets With the Troops About Social Media

The Insider - Heard on the Street

As I write this column, Tesco's new CEO Philipe Clarke and his deputy Tim Mason, Tesco's new group deputy CEO and the CEO of Fresh & Easy Neighborhood Market USA, are meeting with various members of the company's management team in the United Kingdom and one of the key items on the meeting agenda is social media and social commerce.

As we've previously reported in Fresh & Easy Buzz, one of Clarke's first initiatives since taking over from Terry Leahy on March 2 as CEO of Tesco plc is to increase the use of social media throughout Tesco's global operations, which range from the United Kingdom and parts of Europe, to Asia and the United States (Fresh & Easy.) [See - [See - February 24, 2011: Dormant No More: Fresh & Easy Neighborhood Market CEO Tim Mason is Now Tweeting on Twitter.]

Tweeting with the CEO

One of Clarke's social media platforms of choice is Twitter, which he started using in November 2010. Under the new CEO's initiative, nearly all of Tesco's senior managment and numerous members of its mid-management team have been setting up Twitter accounts over the last few weeks.

Among these "tweeters" is Clarke's deputy, Tim Mason, who as we reported on February 24, 2011 [Dormant No More: Fresh & Easy Neighborhood Market CEO Tim Mason is Now Tweeting on Twitter] has had a Twitter feed since 2009 but only recently started tweeting on it.

Tesco's El Segundo, California-based Fresh & Easy Neighborhood Market, which operates 169 stores in California, Arizona and Nevada, was out in front of parent company Tesco in using social media in general and Twitter specifically. Fresh & Easy, with the help of a social media savvy PR consultant, set up Facebook and Twitter accounts in early 2009, along with a Flickr photo-sharing site. Previous to that the grocer had a YouTube channel, which it continues to use as part of its multi-channel and multi-site social media efforts.

When will "TescoStores" go live on Twitter?

Fresh & Easy wasn't the only Tesco entity to set up a Twitter Feed in early April 2009. Tesco plc itself set up a corporate Twitter account, "TescoStores," which you can view here, on April 3, 2009. However, its first and to date only two tweets were made on that very same day, April 3, 2009. The two April 3, 2009 tweets:

>All Easter Eggs Half Price This Weekend Only - Hurry While Stocks Last! 2:33 AM Apr 3rd, 2009 via web

>Every Little Helps - Welcome to Tesco on Twitter! 2:33 AM Apr 3rd, 2009 via web.

"TescoStores," which is a "real" and not pseudo Tesco Twitter feed - it's followed for example by CEO Philipe Clarke, deputy CEO Tim Mason and other Tesco executives - has remained dormant since those first - and last - two tweets on April 3, 2009, despite the fact the corporate feed has 6,165 followers at the time this piece is being published. That's a good number of followers for a Twitter feed that's had zero activity for two years.

Since the corporate feed was set up in April 2009, Tesco has established a number of Twitter feeds that it's using regularly, one of the newest being its food-oriented "TescoRealFood." It also has separate Twitter feeds for Tesco Magazine, clothing at Tesco, Tesco digital and other specific categories.

When I heard this morning that one of the topics of the meeting led by Tesco CEO Philip Clarke today was going to be social media and commerce, I immediately thought about the "TescoStores" Twitter feed, since I've noticed that nearly all the new Tesco tweeters have been following it over the last few weeks but that it remains dormant.

One Tesco executive recently suggested to me in confidence the reason the Tesco corporate Twitter feed has yet to see any action post the two April 3, 2009 tweets is because no decision has been made on how to use it or even if to keep it, adding it would be a shame not to use it considering how many followers there are despite not being in use.

Perhaps one of the outcomes of today's meeting at Tesco corporate headquarters in the UK, where social media and social commerce are being discussed, will be a decision about how to use the long dormant "TescoStores" Twitter feed, which really is a no-brainier. It's a corporate feed - use it as such, just like Walmart and others do, adding whatever special emphasis and meaning it can to brand it as Tesco. And one of the great things about Twitter feeds is they're works in progress and can be fine-tuned in real time.

After all, using Twitter is something CEO Clarke has rapidly implemented within Tesco, the result being an explosion of new Tesco executive and employee Twitter feeds being set up over the last few weeks. Not all of the new feeds are being used though. And only a handful of the Tesco executives who've recently set up the new Twitter feeds are using them in any regular sort of way.

'Tweet me up' Philipe: Every Little Helps

CEO Clarke and Tesco should think about the "TescoStores" Twitter feed in this way: Hub-and-spokes. The Tesco corporate Twitter feed is the hub (or mothership) from which all of the Tesco specialty (Tesco Magazine, Tesco.com, Tesco clothing, digital, ect.) and individual (executives, employees, divisions like Fresh & Easy, Tesco Asia, ect.) Twitter feeds look to for information and inspiration, while at the same time providing grass roots (divisional and individual tweeters) information and inspiration to the hub, or mothership. The concept is similar to the hub-and-spokes wheel Tesco uses in its overall strategy planning.

After all, a dormant mothership, be it on Twitter or elsewhere, makes for an incomplete family. Therefore, decision or not at today's meeting, Tesco should either start using "TescoStores" or just get rid of it, as dormancy is something that's neither good for fresh fruit, grocery stores, or social media sites.

My prediction: Tesco will start posting tweets on "TescoStores" no later than two weeks from today.

From a personal and editorial perspective, If I'm wrong and Tesco doesn't do so, then I'm merely wrong on a prediction (which the editor hates me to make) as your humble columnist.

But if my prediction is wrong, from the wider Tesco corporate perspective it means Tesco is really wrong, because leaving the corporate Twitter feed dormant, which is analogous from a corporate social media perspective to leaving the storefront of a grocery store dormant and unattended - it's kind of like forgetting to turn the sign on the shop door over from "Closed" to "Open for Business" each morning. (Yes, it's a sort of a win-win then either way for your humble columnist.)

For a retailer, God, or the devil depending on your preferred usage, is in the details, both in its stores and in the social space it uses (or leaves dormant) in cyberspace. And like it's said by one major global retailer - Tesco - when it comes to its making sure each and every detail is just right: "Every Little Helps."

- The Insider

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