Showing posts with label WIC Vouchers. Show all posts
Showing posts with label WIC Vouchers. Show all posts

Monday, October 10, 2011

Gov. Signs AB 183: End of Self-Service Checkout Only in California For Fresh & Easy Neighborhood Market if Stores to Still Sell Alcohol

Self-service checkout at Fresh & Easy Neighborhood Market.

News/Analysis/Commentary

California Governor Jerry Brown signed AB 183 into law on Sunday, as we predicted he would.

The legislation authored by California Assemblywoman Fiona Ma that becomes law January 1, 2012 bans the sale of alcoholic beverages at self-service checkout stands in all format retail stores in California.

We nicknamed AB 183 the "Son of Tesco Fresh & Easy Law" because like the previous two other legislative attempts in 2008 and 2010 (which we nicknamed the "Tesco Fresh & Easy Law") to ban alcohol sales at self-service checkouts in retail stores in the Golden State, AB 183 will have the most immediate and direct affect on Tesco's Fresh & Easy Neighborhood Market because it's the only grocery chain in California that offers self-service checkout only in its stores, rather than the option of full or self-service.

The "Tesco Fresh & Easy Law" is now a reality for United Kingdom-based Tesco, which has 133 of its 182 small-format fresh food and grocery stores in California. The other 49 units are in Arizona (28 stores) and Nevada (21 units).

All but one or two of the 133 Fresh & Easy stores in California offer wine and beer for sale. A number of the stores also offer spirits for sale on the shelves, along with the wine and beer offering.

AB 183 amends California's offsale beer, wine and liquor license code to require retailers that have existing permits and licenses and who apply to offer alcoholic beverages for sale at future store locations, to sell the adult beverages at full-service checkouts, where there is a face-to-face transaction between customers and store employees.

Therefore, as we've said in our extensive coverage of the legislation, based on the current language of AB 183, Tesco's Fresh & Easy Neighborhood Market is going to have to at a minimum operate one full-service checkout stand in its stores in California in order to comply with the new law banning sales of alcohol at self-service checkouts come January 1, 2012.

The other alternative is that Tesco could stop selling alcoholic beverages completely in its stores in California, thereby leaving its self-service checkout system as it is. That, however, is highly unlikely in our analysis and opinion because alcoholic beverage sales, particularly its proprietary brand wines, is an important merchandising element for Fresh & Easy.

We first suggested in early 2008, before any legislation banning alcohol sales at self-service checkouts was ever introduced in the California Legislature, that one of the key operational mistakes Tesco has made with Fresh & Easy Neighborhood Market is to offer self-service checkout only in its stores. Doing so limits consumer choice and limits the potential universe of customers for Tesco's Fresh & Easy stores, thus limiting sales for the chain.

We continue to believe offering self-service checkout only in the Fresh & Easy stores is a very poor management decision.

On Wednesday (October 5, 2011) Tesco reported a 23% reduction in losses for Fresh & Easy for the first six months of its current fiscal year, compared to the same period last fiscal year.

Tesco lost $112 million (on sales of $470.5 million) on Fresh & Easy for the 2011/12 fiscal year, which ended August 27, 2011. That's compared to a loss of $151 million for the previous fiscal half year. Tesco had 177 Fresh & Easy stores opened at the August 27, 2011 half-year end, compared to 159 units for the same period a year ago. There are currently 182 stores.

The 23% reduction in the half-year loss for Fresh & Easy is a significant one for Tesco. But it's still a very long road to Tipperary. Tesco CEO Philip Clarke says the global retailer will break even with Fresh & Easy by the end of its 2012/13 fiscal year, which is about 16 months away.

Clarke has made numerous changes, mostly cosmetic ones though, at Fresh & Easy since becoming CEO of Tesco in March of this year. These include adding in-store bakeries and a few other design and merchandising additions and changes.

But ironically, in our analysis, the one change Clarke hasn't made but that has the potential to dramatically increase business at Fresh & Easy has just been mandated by the Governor of California.

Were we running Tesco and Fresh & Easy, we would move rapidly to offer shoppers the option of self and full-service checkout not only in the 133 Fresh & Easy Neighborhood Market stores in California, but in all 182 stores in California, Nevada and Arizona, which is something we would have done from the start, as we've noted more than once in Fresh & Easy Buzz.

We would offer both full-service and self-service checkout in the stores and, using Fresh & Easy's new loyalty points card which it's rolling out to all the stores next week, give customers who use the self-service checkouts bonus points for doing so, thereby encouraging them to scan and bag their own grocery purchases.

Offering both full and self-service checkout in this way at all the Fresh & Easy stores not only would comply with AB 183 in California where all but 49 of the stores are located, it would also serve to increase the potential universe of shoppers - those many who hate self-serve checkout and don't shop the stores now because of it - for the Fresh & Easy stores. The result: A stronger customer base and added sales.

Additionally, giving customers loyalty points they can redeem for savings on the new digital loyalty cards Fresh & Easy is introducing chainwide this week would encourage the use of the self-service checkouts, which are a labor-saving tool for the grocer.

The addition of the full-service checkout option chainwide will also allow Fresh & Easy Neighborhood Market to accept paper WIC Vouchers in all its stores, something it currently does in only one store, a unit in South Los Angeles, with plans to also do so at the store in San Francisco's Bayview district.

One of the reasons Fresh & Easy hasn't rolled out WIC chainwide is because of the difficulties the chain has had processing the paper vouchers under its self-service checkout only system. With the full-service checkout option in the stores, accepting WIC would be an easy process, as grocery checkers can simply process the vouchers like it's done at other grocery stores.

The potential sales boost for Fresh & Easy if it accepts WIC at all its stores is considerable. For example, according to the California WIC agency, about 7 million mothers receive the vouchers used to purchase healthy foods like infant formula, fresh milk, whole grain cereals, produce and other similar items in California. Therefore, by accepting WIC at its 133 Fresh & Easy stores in California, Tesco would expand its potential customer universe even more. Currently these 7 million potential customers in California are off the table for Tesco's Fresh & Easy.

Another benefit of accepting WIC in all the stores is that most of the items purchased by customers using the vouchers are at full margin.

This fact could potentially help Tesco with its gross and trading margin problems at Fresh & Easy. For example, on Wednesday Tesco reported a negative -24% trading margin for Fresh & Easy for the first half of its fiscal year. That's an improvement of about 10 basis points over the previous period but remains a serious problem for the retailer in its quest to break even by February 2013. It must get that negative margin into positive territory.

The full-service checkout option will also allow Fresh & Easy to accept paper personal checks and to cash customer payroll checks, which it currently doesn't do, in large part because of the same technical difficulties involved in processing the paper WIC Vouchers at the self-service checkouts.

Just like with WIC, grocery checkers could cash payroll checks and process paper personal checks at the full-service checkouts, thereby adding needed shopper choice and expanding the potential universe of customers for the Fresh & Easy stores.

We first pointed out in 2008, as we did with the self-service checkout only system, how not accepting WIC, paper personal checks and payroll checks is a serious operational flaw for Tesco's Fresh & Easy. [For example, see these two stories - September 7, 2008:  Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions; and March 7, 2009: Analysis & Commentary: The Seven Retail Operations Changes Tesco's Fresh & Easy Neighborhood Market Needs to Make to Help it Get On the Success Track.]

From where we sit, closely covering and analyzing Tesco's Fresh & Easy Neighborhood Market for over four years, the passage of AB 183 into law in California is actually an operational blessing in disguise for Tesco if it offers the full-service checkout option, accepts WIC Vouchers in all its stores and invites shoppers to use paper personal checks and cash payroll checks at the checkouts if they so choose to do so as another option in paying for their grocery purchases.

Tesco went with self-service checkout only and the acceptance of plastic debit, EBT (food stamps) and credit cards only for payment at Fresh & Easy Neighborhood Market because it believes the labor savings from not offering a full-service checkout option and processing paper - the WIC Vouchers, personal and payroll checks - trumps the added business Fresh & Easy might get from offering the options.

However, we suggest the last four years of performance by Fresh & Easy since the first stores opened in November 2007 - a loss of about $1 billion - demonstrates the opposite is the case.

Shoppers like options and choice, which is something every experienced grocer knows, particularly in California. By expanding those options and choices like we've suggested in this piece, Tesco will find itself adding customers and sales to its Fresh & Easy stores, which is an option that in our analysis will exceed the labor savings benefits the retailer thinks it's getting currently by limiting customer choice.

Related Stories

September 9, 2011: 'Son of Tesco Fresh & Easy Law': Self-Service Checkout Booze Ban Bill Passes California State Senate; Headed to Governor's Desk For Action

September 7, 2011: Self-Service Checkout Booze Ban Bill Fails in California Senate First Time Around; 'Missing Seven' Dems Hold Key to Passage By Friday

September 6, 2011: California State Senate Set to Vote on Self-Service Checkout Booze Ban Bill This Week

August 20, 2011: 'Son of Tesco Fresh & Easy Law': Self-Service Checkout Booze Ban Bill AB 183 Passes Out of California Senate Appropriations Committee; Headed For Senate Floor

July 27, 2011: 'Son of Tesco Fresh & Easy Law' Moving Through State Senate: Will California Determine Fresh & Easy Neighborhood Market's Checkout Scheme?

June 4, 2011: 'Son of Tesco Fresh Easy Law': Self-Checkout Booze Ban Bill AB 183 Sails Through California State Assembly; State Senate Next Stop

May 11, 2011: ‘Son of Tesco Fresh & Easy Law' - California Assembly Appropriations Committee Passes Self-Checkout Ban Bill AB 183 By 12-4 Margin

May 6, 2011: 'Son of Tesco Fresh & Easy Law': California State Assembly Appropriations Committee Hearing For AB 183 Cancelled

May 4, 2011: 'Son of Tesco Fresh & Easy Law': Strong Chance California Legislation to Prohibit Alcohol Sales at Self-Service Checkouts Could Pass This Year

September 30, 2010: Fresh & Easy Neighborhood Market Hopes Governor Schwarzenegger Can Find His Veto Pen Before Midnight Tonight

September 28, 2010: Fresh & Easy Neighborhood Market Hoping Governor Schwarzenegger Prefers His Veto Pen When it Comes to AB 1060

September 25, 2010: Future of Fresh & Easy Neighborhood Market's Self-Service-Only Checkout in California Up to Governor Schwarzenegger

August 24, 2010: California State Senate Sends Bill to Governor That Could End Self-Service-Only Checkout at Fresh & Easy Neighborhood Market

August 15, 2010 piece : Bill to Ban Alcoholic Beverage Sales at Self-Service Checkouts Would End 'Self-Service Only' at California Fresh & Easy Neighborhood Market Stores

July 14, 2008: Breaking News & Analysis: CA Assemblyman Introduces 'Tesco Fresh & Easy Law' to Ban Stores With Self-Checkout-Only From Selling Alcoholic Beverages.

Thursday, August 25, 2011

Tesco Opens Long-Awaited Fresh & Easy Neighborhood Market Store in San Francisco's Bayview-Hunters Point Neighborhood

Nearly four years in the making, Tesco opened its Fresh & Easy store (above) in San Francisco's Bayview-Hunters Point neighborhood yesterday. [Photo credit: Fresh & Easy Buzz.] Kevin, a Fresh & Easy Buzz reader who lives in Bayview-Hunters Point, e-mailed us this review (in the quotes below) he posted on the Yelp review site shortly after the store opened yesterday: "It's open. First new grocery store in the Bayview in decades; and it's a grand success. Organic offerings throughout the store - fresh, beautiful stuff. A true full-service grocery store, even offering a full line of wine & spirits. The Bayview in all it's multi-cultural glory is on display here - throngs of happy, smiling people mingling, laughing and honestly joyous about this long-awaited addition to the neighborhood. The staff is helpful and thoughtful - eager to help."

Tesco opened its long-awaited Fresh & Easy Neighborhood Market fresh food and grocery store in the 5800 Third Street condominium development at 3rd Street and Carroll Avenue in San Francisco's Bayview-Hunters Point neighborhood yesterday, completing a nearly four-year process that began when the retailer announced its plans in January 2008 to open a store in the low-income neighborhood underserved by grocery stores that offer a selection of fresh food and groceries at affordable prices.

The opening of the Fresh & Easy store yesterday - Tesco's second unit in San Francisco, 13th store in Northern California, 128th market in California and store number 177 in total - at 3rd Street and Carroll Avenue in San Francisco's Bayview-Hunters Point kicked off at a 10 a.m with presentations by Tim Mason, the CEO of Fresh & Easy Neighborhood Market and deputy CEO of parent company United Kingdom-based Tesco (pictured below), San Francisco Mayor Edwin Lee, David Chiu, president of the San Francisco Board of Supervisors, Malia Cohen, who represents the neighborhood on the board, and Sophia Maxwell, who formerly represented the area on the San Francisco Board of Supervisors and was instrumental in getting the grocer to locate a store in the new 5800 Third Street development, which opened early this year.

Mayor Lee, who is being challenged next year for the city's top elected office by Chiu and numerous others, presented a check for $1,000 to the Bayview-Hunters Point YMCA, which was chosen by the employees of the store to receive the donation Fresh & Easy gives to a local non-profit group each time it opens a new store, while the other San Francisco politicos, Mason and members of his senior executive team encouraged him on.

"I made a commitment to the community to improve Bayview-Hunters Point and make it a place that is safe and healthy for families," Mayor Lee said during his presentation this morning. "This project is a cornerstone in our broader efforts to revitalize the neighborhood by bringing healthy food, vibrant businesses, and new shoppers to Third Street."

Lee is San Francisco's former chief administrator, which is a non-elected position. He was appointed by the San Francisco Board of Supervisors early this year to fill the remaining term of then mayor Gavin Newsom, who was elected California's Lieutenant Governor in November 2010 and took office in January 2011.

It was during Newsom's term as mayor, in 2007, that Tesco agreed to locate a store in the 5800 Third Street development, which at the time was a vacant piece of land and the site of a former Coca-Cola bottling plant.

At the time of his appointment - and up until a few weeks ago - Lee said he would not run for mayor in 2012. However he recently announced he will run for the top office in the city and is being supported by local political heavyweights like Senator Dianne Feinstein and former San Francisco Mayor and California State Assembly Speaker Willie Brown. Both Feinstein, also a former mayor, and Brown are long time residents of and political players in San Francisco.

It was during Brown's two terms as mayor that the city's long-delayed plans to revitalize the low-income Bayview-Hunters Point District began to take shape

As mayor, San Francisco first African American to be elected to the office, Brown pushed through a plan to extend San Francisco's Muni light rail system into the historically majority-African American Bayview-Hunters Point  neighborhood, which previously had been neglected by most elected officials at City Hall, although Brown's close friend, former Mayor George Moscone, who was assassinated in the 1980's along with Supervisor Harvey Milk by another then-Supervisor, Dan White, made some efforts during his tenure to improve the neighborhood. Feinstein, who was President of the Board of Supervisors at the time, replaced Moscone as mayor, then later went on to become one of California's two U.S. Senators.
Above and below: Shoppers browse the aisles yesterday. [Photo credit: Fresh & Easy Buzz.]

The extension of Muni into Bayview-Hunters Point - there's a major stop right in front of 5800 Third Street where the Fresh & Easy store is located - paved the way for what is becoming a slow but steady revitalization of the neighborhood, which was essentially created during World War two when shipyards were built in the area to build ships for the two-front war effort in Europe and Japan, which created numerous jobs at the time.

Post-World War II  Bayview-Hunters point has seen a steady decline in income and opportunities for its 35,00-40,000 residents. Part-and-parcel of this phenomenon has been a lack of grocery stores in the neighborhood, which is considered a "food desert."

Newsom, who was supported by Brown and replaced him as mayor, continued to put a focus on Bayview-Hunters Point during his nearly two terms in office. That focus included working with former supervisor Maxwell and others to bring the 5800 Third Street development to Bayview-Hunters Point along with the Fresh & Easy store, which Tesco owns rather then leases.

Ironically, when it comes to grocery chains - there is a Foods Co discount warehouse grocery store owned by Kroger Co. located in Bayview-Hunters Point - local chains like Safeway Stores, Inc., which is headquartered just 30 miles from San Francisco in Pleasanton and is the leading food retailer in San Francisco with 14 supermarkets, weren't interested in the neighborhood. Instead, the grocer from across the pond, Tesco, ended up being the first grocery chain to open a new store in Bayview-Hunters Point in two decades. It was about 20-years ago when the Foods Co store was opened in the neighborhood.

About 200 customers, according to our count, attended the grand opening during its opening couple hours, including numerous residents of the 5800 Third Street development who told us they were extremely pleased to finally have the Fresh & Easy store open so they can do their grocery shopping on-site.

Along with the customers, about a dozen protesters attended the store opening, including those representing the United Food & Commercial Workers (UFCW) union (Fresh & Easy is non-union) and a neighborhood group, Clergy & Laity United for Economic Justice, that has asked Tesco's Fresh & Easy to remove alcoholic beverages from the store.

The group is also protesting about the fact that Fresh & Easy Neighborhood Market doesn't except WIC Vouchers in any of its stores besides a single unit in South Los Angeles, which is a story Fresh & Easy Buzz has been in the lead about since early 2008.

Fresh & Easy's CEO Mason however says the grocer has applied to except WIC Vouchers at the store in Bayview-Hunters Point (which is something we first said here in 2008 the grocer should do when it opened the store) and plans to start excepting the vouchers, which provide fresh and healthy foods to mothers for their children, soon.

The Clergy & Laity United for Economic Justice supports AB 183, which as we've reported extensively about would if passed by the California State Senate and signed by Governor Jerry Brown banned the sales of alcoholic beverages at self-service checkout lanes in retail stores in California. Tesco's Fresh & Easy uses an all self-checkout model in its 177 stores in California (128 stores), metropolitan Phoenix, Arizona (28 units) and metro Las Vegas, Nevada (21 stores).

Reverend Carol Been, a senior organizer for the group, says though that the organization is going a step beyond AB 183 and wants Fresh & Easy to stop selling alcoholic beverages entirely in the Bayview-Hunters Point store, siting among other reasons the alcohol-infused violence that broke out during last Saturday's football game at nearby Candlestick Park (about a mile away from the store) between the San Francisco 49ers and the Oakland Raiders.

Numerous stores in the neighborhood sell alcoholic beverages, as does the ball park itself. For example, according to the City of San Francisco's Economic Development Department their are about 90 liquor stores operating at present in Bayview-Hunters Point.

Therefore its unlikely Tesco's Fresh & Easy will remove the adult beverages from its shelves just because it's being singled out by the group for such action. The grocer went through the full process of obtaining an alcoholic beverage license, which was granted to it by the State of California. The City of San Francisco didn't object to the granting of the license either, which municipalities have a right to do in California.

The neighborhood group says its singling out Fresh & Easy to remove alcoholic beverages because of its self-service only checkout policy. However, if AB 183 does become law, it will likely make that a moot point because as the legislation is currently written it would require the grocer to at a minimum have one full-service checkout in each of its California stores because the bill, which we've nicknamed the "Son of Tesco Fresh & Easy Law," requires face-to-face interaction between a store clerk and customer whenever alcohol is purchases.

The group also says Fresh & Easy didn't hire locally for the Bayview-Hunters Point store. However, the grocer actually hired 40 employees for the store, which is almost double the number (20-25) it normally hires to staff one of its small-format grocery markets.

In addition, Mason said yesterday - and he told the same thing to Mayor Edwin Lee - that 52% of the 40 store employees are from the Bayview-Hunters Point Neighborhood. Additionally, earlier this year Fresh & Easy held a job fair at the neighborhood YMCA, which it donated $1,000 to yesterday, which is where many of those employees were hired from.
Above: The bakery department in the Bayview-Hunters Point store, which includes an oven where fresh breads and pastries are baked in-store. Fresh & Easy started adding the in-store bakeries to its existing 176 stores in July. All new stores will include the departments. We broke the news about the in-store bakeries in this May 18, 2011 piece. Below: Frozen foods in the 3rd Street and Carroll Fresh & Easy store are displayed in upright cases with glass doors. This is another change for the grocer, which is replacing the reach-in frozen food cases in its stores with the more modern units, which is also news we broke in the May 18 piece.

From a business perspective the hiring of 40 employees instead of the 20-25 Fresh & Easy normally hires per-store is difficult to understand. We've predicted the Bayview-Hunters Point store will be one of the grocers top stores in terms of average weekly sales. However, it doesn't need 40 employees to staff it in our analysis. All of Fresh & Easy's store workers are part-timers, working 20-35 hours week, accept for the store managers, assistant managers and team leaders, although in some cases they too work part time.

The grocer way be creating a potentially damaging situation for itself in hiring so many workers for the store in that (1) it could likely result in the workers getting fewer hours - they get health benefits if they work 20 hours or more a week - and even more serious could be that (2) Fresh & Easy will find itself to high of a labor expense number at the store down the road a bit and have to layoff some of the 40 employees, which will likely lead to damaging its reputation in the neighborhood.

Mason also made a little news at the opening, saying the grocer plans to open its third store in San Francisco - the unit at Silver Avenue & Goettingen in the Portola District which like the Bayview-Hunters Point store it acquired  in late 2007 and announced in January 2008 - in early 2012, confirming our previous reports that it would be the next Fresh & Easy store to open in the city.

As we've previously reported, Fresh & Easy also has a fourth store in the works in San Francisco. That unit will be in the former Delano's IGA Market store at 1245 South Van Ness Avenue in the city's Mission District. Based on our current information we expect that store to open in early-to-mid 2012. (See here for details.)

Tesco is also looking for additional locations in San Francisco for both its 10,000 square-foot Fresh & Easy stores as well as for its smaller footprint (3,000-4,000 square-foot) new "Fresh & Easy Express" format, as we've previously reported.

We've been reporting on and writing about Tesco's plans to open a Fresh & Easy market at the Bayview-Hunters Point location since the grocer first announced its intention to do so in January 2008. We said then and still suggest it will be one of the top performing Fresh & Easy stores in the chain.

In our analysis it should be among the top 10%-15 in average weekly sales among the current 177 stores in operation in California, Nevada and Arizona. Additionally, excepting WIC Vouchers at the store will in our analysis provide at least 5%-10% more sales than if the grocer doesn't except the vouchers, which is currently the case at the store, as it is with all but one of the Fresh & Easy markets, the unit in South Los Angeles.

If we're right, and we believe we are, that's good news for Tesco. But the United Kingdom-based global retailer will need much more than a good location in Bayview-Hunters Point in order to achieve its goal of breaking-even with Fresh & Easy Neighborhood Market, which it lost about $300 million on in its latest fiscal year ended in February 2011, by the end of its 2012/13 fiscal year, which is just 18 months away.

That's something we will continue to explore in Fresh & Easy Buzz in the coming months. Stay tuned.

Related Stories

>We've reported on and written extensively about the Fresh & Easy store at 5800 Third Street in San Francisco's Bayview-Hunters Point Neighborhood. Click on these link - , ,  - to read those stories and analysis.

>We were the first publication to point out that Tesco's Fresh & Easy doesn't except WIC Vouchers in its stores. Following our extensive reporting and analysis, which included a focus on the store in South Los Angeles, the grocery chain began excepting the vouchers in that store. We also first said in a couple stories in 2008 (and since then) that Fresh & Easy would be making a mistake and missing an opportunity if it didn't except the vouchers in the Bayview-Hunters Point store when it opens. You can read those stories at these links - , , , , , .

>AB 183 is the latest of three legislative bills in California that beginning in 2008 have been designed to ban the sale of alcoholic beverages at self-service checkouts in grocery and other retail stores in the GOlden State. We've reported on and written extensively about the legislation, including a recent piece last week. See those stories at this link - .

[Editor's Note: Photo of Tim Mason courtesy Fresh & Easy Neighborhood Market.]

Wednesday, December 15, 2010

Fresh & Easy Neighborhood Market's California WIC Voucher Expansion Program Stalled

Related story - December 15, 2010: A Tale of Two California's: Welcome to the Once Thriving Central Valley.

In July of this year we reported that after much delay, Tesco's Fresh & Easy Neighborhood Market finally began accepting WIC Vouchers at one of its 106 stores in California, the unit at 1025 East Adams Boulevard (Central & Adams) in low-income South Los Angeles. There are 155 Fresh & Easy stores. In addition to the 106 California markets, there are 28 units in Arizona and 21 stores in Nevada.

In our story about the development - July 30, 2010: Fresh & Easy Neighborhood Market Store at Central & Adams in South Los Angeles is Now Accepting WIC Vouchers; Additional Stores to Follow - we reported that following the test at the Central & Adams store in South Los Angeles, which opened in February 2010, Fresh & Easy planned to roll out the acceptance of the vouchers, which are provided by the state to low-income mothers so they can purchase specific nutritious foods like whole milk, infant formula, whole grain cereals and breads, and fresh produce, for their children, to selected other stores in California.

At the time, Fresh & Easy was looking to expand its acceptance of the WIC Vouchers to additional stores by at least the early fall, according to our sources.

However, nearly five months later, the grocer has yet to begin accepting the vouchers at any additional Fresh & Easy Neighborhood Market stores in the Golden State, according to our research.

Not long after it began taking the WIC Vouchers at the south Los Angeles market in July, Fresh & Easy sent out a memo, which included a "WIC cabinet/shelf schematic," to store managers at various stores in Southern California and in the Central Valley (Bakersfield and Fresno regions), alerting them that an expansion to other stores would be coming in the near future. But five months later, and with 2010 coming to an end, the roll out has been long-stalled.

We've recently talked to a number of store managers and team leaders at Fresh & Easy markets in Southern California and in the Central Valley, particularly those in low-income neighborhoods, who tell us they aren't sure if or when the acceptance of WIC Vouchers will be rolled out to additional stores, despite being under the impression since this summer that such a roll out was coming well before the end of the year.

One Fresh & Easy management employee in the Central Valley tells us that at least three of the seven stores in the Bakersfield region could see a 10%-15% sales boost simply if WIC Vouchers were accepted at the markets. The employee also told us the other four stores should see an at least 5%-10% increase from WIC because WIC Voucher use is up so much since the recession hit the area hard in 2007-2008.

The Fresh & Easy worker sited a Save Mart-owned Food Maxx discount grocery store and a Safeway-owned Vons supermarket, both located near a Fresh & Easy unit in Bakersfield, that generate tens of thousands of dollars a week in sales from customers using the WIC Vouchers to purchase high-ticket items like infant formula, whole grain breads and cereals, and gallons of whole milk.

A store-level manager in the Fresno area told us a similar story, saying WIC Voucher and food stamp use has grown so much in the Central Valley region over the last few years because of the high joblessness and growing poverty rate that the particular store turns away customers regularly who attempt to purchase WIC-approved items like whole milk, produce, cereals, eggs and other items but are unaware the Fresh & Easy stores don't except the vouchers.

The manager, who has extensive grocery retailing experience in the region, said all seven of the Fresno-area Fresh & Easy stores would see sales growth if they could accept the vouchers, with at least three of the stores likely gaining double-digit sales increases if the WIC acceptance to expanded to the area.

The Central Valley has the highest joblessness rates in California, ranging from 14% unemployment in the best counties to 20% in the worse areas. California's unemployment rate is currently 12.4%.

The region's poverty rate is also among the highest and fastest-growing in the nation. Many experts have taken to calling the Central Valley "America's new Appalachia," for example, because of its high and growing poverty rate.

Unlike food stamps, which today are called SNAP and come loaded on a plastic debit card so grocery stores can handle the transfer of payments electronically at the point-of-sale, WIC Vouchers are paper, similar to a check. Grocers must process the vouchers in the same way they do paper checks.

Tesco's Fresh & Easy Neighborhood Market has self-service checkout and doesn't accept paper checks in the stores. Therefore, its point-of-sales systems aren't set-up to process the paper vouchers - along with paper checks or manufacturers' cents-off coupons.

In order to process the WIC Vouchers at the south Los Angeles store, Fresh & Easy had to make modifications to the store's point-of-sale system. Additionally, store clerks must assist each customer who pays for their purchases using the vouchers.

Based on our reporting, it appears two factors are primarily behind Fresh & Easy's having not rolled out the acceptance of the WIC Vouchers to additional California stores, despite the fact its plans, at least this summer, were to do so.

First, Fresh & Easy Neighborhood Market has had numerous problems with the adapted point-of-sale system at the Third & Adams store in south Los Angeles, in terms of processing the paper WIC Vouchers.

In addition, the grocer doesn't want to establish a full-service checkout lane in each of its stores, which it might have to do if it accepted the vouchers in all 106 of its California stores. Doing so would add to overall store labor expenses. (In our experience and analysis, the added sales from WIC would more than make up for any such added labor costs though.)

Meanwhile, store managers and clerks at numerous Fresh & Easy markets in California, particularly those in low-income neighborhoods in Los Angeles and other parts of Southern California, as well as in the Central Valley, wonder what's taking so long in terms of expanding the acceptance of the WIC Vouchers to additional stores in California?

It seems like a good question for them to ask, since as they've told us, Fresh & Easy store workers are regularly sending shoppers who come in the stores wanting to use WIC Vouchers - as well as customers who use food stamps and cash to shop at the stores but also get WIC Vouchers but can't use them when they shop at Fresh & Easy - down the street to a Vons, Ralphs, Stater Bros., Albertsons, Walmart, Save Mart or other competitor's store - virtually every chain and independent of note in California accepts WIC Vouchers - and losing needed sales in their stores.

[Editor's Note: Three years ago, Fresh & Easy Buzz first pointed out and reported on the fact that Tesco's Fresh & Easy Neighborhood Market, which opened its first stores in November 2007, didn't accept WIC Vouchers. Additionally, in analysis and commentary pieces beginning in 2008 - and right up until the grocer decided to accept the vouchers at its first store, the Central and Adams unit in South Los Angeles on July 29 - we've also pointed out in detail how, from both business (added sales) and ethical grocer perspectives, Fresh & Easy was missing the boat by not accepting WIC in its stores. All this time later, the grocer continues to miss that same boat by failing to roll out the acceptance of WIC to additional stores in California.

Below is a selection of some of those past stories from Fresh & Easy Buzz:

July 30, 2010: Fresh & Easy Neighborhood Market Store at Central & Adams in South Los Angeles is Now Accepting WIC Vouchers; Additional Stores to Follow

July 28, 2010: What A Long, Strange Trip it's Been: South Los Angeles Will Be First Fresh & Easy Neighborhood Market Store to Accept WIC Vouchers Starting Tomorrow

July 7, 2010: Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month

September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions

December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary

February 10, 2008: Tesco's Fresh & Easy Opens Latest New Store in 'Food Desert' City of Compton, California

July 2008: Tesco's to Open A Fresh & Easy Grocery Market in Low Income, Underserved South Central Los Angeles Neighborhood

March 7, 2009: Analysis & Commentary: The Seven Retail Operations Changes Tesco's Fresh & Easy Neighborhood Market Needs to Make to Help it Get On the Success Track

July 11, 2008: 'Food Desert' Neighborhoods and Southern California: More on the Fresh & Easy Store Planned For South Central Los Angeles

July 15, 2008: Fresh Food to Bloom in An Inner-City Food Desert: Tesco's Fresh & Easy Breaks Ground For New Store in Underserved South Los Angeles Neighborhood

February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles

February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

April 22, 2010: Breaking Buzz: Tesco's Fresh & Easy to Accept WIC Vouchers at its East Adams Store in South Los Angeles

May 14, 2010: Fresh & Easy Neighborhood Market Not Yet Accepting WIC Vouchers at South L.A. Store; No Start Date Set

July 6, 2008: Former NBA Great Earvin 'Magic' Johnson is Working His Business Magic in Urban, Inner City Neighborhoods; We Offer An Idea For Tesco's Fresh & Easy

May 12, 2008: Food Deserts: Coalition to Create 'Blue Ribbon' Commission, Draft Report to Encourage Grocers to Open Stores in Underserved Los Angeles Neighborhoods

February 13, 2008: Leading Democratic Candidate for President Barack Obama Joins Group in Asking Tesco's Fresh & Easy to Put More Stores in Underserved Neighborhoods

June 3, 2008: Fresh & Easy Buzz Redux: Barack Obama to Tesco's Fresh & Easy in Our February 13 Piece: 'Build More Stores in Underserved Neighborhoods'

September 23, 2008: Food Retailing, Society & Economics: 'Food Deserts' and Public Health

March 20, 2009: Federal Government Spending Bill Increases WIC Voucher Program Dollars by $1.2 Billion; 21 Percent Increase

May 28, 2008: Las Vegas Market Report: A 'Food Desert' Neighborhood to Get A New Grocery Store; But it's Not A Fresh & Easy Neighborhood Market

April 27, 2008: New Study Points to Increasing Urban 'Food Deserts' In North America: Locating Stores in 'Food Deserts' A Part of Fresh & Easy's Strategy

March 7, 2008: Former NBA All-Star and Sacramento Native Kevin Johnson is the Driving Force Behind a Fresh & Easy Market in Sacramento's Oak Park Neighborhood

July 29, 2008: Tesco's Fresh & Easy and San Francisco's Tenderloin Redux: Upcoming Developments Offer First Mover Opportunity For Fresh & Easy or Competitors

Friday, July 30, 2010

Fresh & Easy Neighborhood Market Store at Central & Adams in South Los Angeles is Now Accepting WIC Vouchers; Additional Stores to Follow


The Fresh & Easy Neighborhood Market store at 1025 East Adams Boulevard in South Los Angeles in now accepting WIC Vouchers (Woman, Infant & Children Program).

The store, located at Central and Adams in the low-income neighborhood, started accepting WIC this week, as we previously reported it would. (See our linked stories at the end of this piece.)

A Fresh & Easy Buzz reporter visited the store yesterday.

As we've previously reported, Tesco's Fresh & Easy Neighborhood Market plans to start rolling out the acceptance of WIC Vouchers to a number of its other stores in California, starting in about 30 -to- 45 days. Stores set to accept WIC then include additional Fresh & Easy units in Southern California, like the store in Compton, along with stores in the Bakersfield and Fresno areas in the Central Valley.

Currently there are no plans we're aware of to accept WIC at the 34 Fresh & Easy stores in Arizona or the 27 units in Metropolitan Las Vegas, Nevada. There are 98 Fresh & Easy markets located in Southern California and the Bakersfield and Fresno Metro Regions in the Central Valley.

Each U.S. state handles WIC individually, although most of the funding comes from the U.S. Federal Government via the U.S. Department of Agriculture. In California the program, which provides vouchers to mothers to purchase healthy foods and beverages like infant formula, whole milk, eggs, cheese, whole grain breads and cereals, fruit juices, fresh produce and other similar items for their children, is administered by California WIC.

[Editor's Note: Nearly three years ago, Fresh & Easy Buzz first pointed out and reported on the fact that Tesco's Fresh & Easy Neighborhood Market, which opened its first stores in November 2007, didn't accept WIC Vouchers. Additionally, in analysis and commentary pieces beginning in 2008 - and right up until the grocer decided to accept the vouchers at its first store, which will be the Central and Adams unit in South Los Angeles, on July 29 - we've also pointed out in detail how, from both business (added sales) and ethical grocer perspectives, Fresh & Easy was missing the boat by not accepting WIC in its stores. [Suggested reading: September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions and December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary]

Below is a selection of some of those past stories from Fresh & Easy Buzz:

July 28, 2010: What A Long, Strange Trip it's Been: South Los Angeles Will Be First Fresh & Easy Neighborhood Market Store to Accept WIC Vouchers Starting Tomorrow

July 7, 2010: Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month

September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions

December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary

February 10, 2008: Tesco's Fresh & Easy Opens Latest New Store in 'Food Desert' City of Compton, California

July 2008: Tesco's to Open A Fresh & Easy Grocery Market in Low Income, Underserved South Central Los Angeles Neighborhood

March 7, 2009: Analysis & Commentary: The Seven Retail Operations Changes Tesco's Fresh & Easy Neighborhood Market Needs to Make to Help it Get On the Success Track

July 11, 2008: 'Food Desert' Neighborhoods and Southern California: More on the Fresh & Easy Store Planned For South Central Los Angeles

July 15, 2008: Fresh Food to Bloom in An Inner-City Food Desert: Tesco's Fresh & Easy Breaks Ground For New Store in Underserved South Los Angeles Neighborhood

February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles

February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

April 22, 2010: Breaking Buzz: Tesco's Fresh & Easy to Accept WIC Vouchers at its East Adams Store in South Los Angeles

May 14, 2010: Fresh & Easy Neighborhood Market Not Yet Accepting WIC Vouchers at South L.A. Store; No Start Date Set

July 6, 2008: Former NBA Great Earvin 'Magic' Johnson is Working His Business Magic in Urban, Inner City Neighborhoods; We Offer An Idea For Tesco's Fresh & Easy

May 12, 2008: Food Deserts: Coalition to Create 'Blue Ribbon' Commission, Draft Report to Encourage Grocers to Open Stores in Underserved Los Angeles Neighborhoods

February 13, 2008: Leading Democratic Candidate for President Barack Obama Joins Group in Asking Tesco's Fresh & Easy to Put More Stores in Underserved Neighborhoods

June 3, 2008: Fresh & Easy Buzz Redux: Barack Obama to Tesco's Fresh & Easy in Our February 13 Piece: 'Build More Stores in Underserved Neighborhoods'

September 23, 2008: Food Retailing, Society & Economics: 'Food Deserts' and Public Health

March 20, 2009: Federal Government Spending Bill Increases WIC Voucher Program Dollars by $1.2 Billion; 21 Percent Increase

May 28, 2008: Las Vegas Market Report: A 'Food Desert' Neighborhood to Get A New Grocery Store; But it's Not A Fresh & Easy Neighborhood Market

April 27, 2008: New Study Points to Increasing Urban 'Food Deserts' In North America: Locating Stores in 'Food Deserts' A Part of Fresh & Easy's Strategy

March 7, 2008: Former NBA All-Star and Sacramento Native Kevin Johnson is the Driving Force Behind a Fresh & Easy Market in Sacramento's Oak Park Neighborhood

July 29, 2008: Tesco's Fresh & Easy and San Francisco's Tenderloin Redux: Upcoming Developments Offer First Mover Opportunity For Fresh & Easy or Competitors

Wednesday, July 28, 2010

What A Long, Strange Trip it's Been: South Los Angeles Will Be First Fresh & Easy Neighborhood Market Store to Accept WIC Vouchers Starting Tomorrow

[Photo Credit: Fresh & Easy Neighborhood Market.]

News/Analysis/Commentary

Sometimes the lights all shinin' on me;
Other times I can barely see.
Lately it occurs to me, what a long, strange trip its been.
- Truckin': The Greatful Dead

As we reported in this July 16, 2010 story - South Los Angeles Fresh & Easy Neighborhood Market Store to Accept WIC Vouchers July 29; Additional California Units to Follow, and have been reporting on for some time prior to it - tomorrow (July 29) is the day Tesco's Fresh & Easy Neighborhood Market begins accepting WIC Vouchers (Woman, Infant & Children Program) at its first store - the Central and Adams unit (pictured at top) in South Los Angeles.

Earlier this week store employees, having recently completed training in how to accept and process the WIC Vouchers, were preparing for what one told a Fresh & Easy Buzz correspondent will be "going live" [with WIC] on Thursday.

As we also reported in our July 16 piece, Tesco's Fresh & Easy Neighborhood Market plans to roll out the acceptance of the vouchers - which are distributed to qualifying mothers by California WIC and can be used to purchase healthy food and beverage items for children like infant formula, whole milk, whole grain breads and cereals, fresh produce and other items - to additional stores about 30-45 days after the south Los Angeles store begins accepting WIC.

The South Los Angeles Fresh & Easy store, which is at 1025 East Adams in the low-income neighborhood, opened in February of this year.

There's a Superior Grocers supermarket near the Fresh & Easy which accepts WIC Vouchers, as do all of the Southern California-based chain's stores. By not accepting WIC at the Central and Adams Fresh & Easy store - or at any of its 159 Fresh & Easy stores in California, Nevada and Arizona for that matter - for the last five months, Tesco has been losing out on sales of numerous high ring WIC items like infant formula, whole milk, whole crain cereals and more to the Superior Grocers' supermarket down the street. [See - February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles and February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles]

Additionally, employees at the Central and Adams Fresh & Easy have since February been forced daily to turn away customers who shop at the store and receive WIC Vouchers but who can't use them because the grocery chain doesn't accept WIC. This also is the experience for employees at numerous other Fresh & Easy stores - and has been that way since the first batch of stores opened in November 2007.

It was in early 2008 when we first pointed out the folly of Tesco's Fresh & Easy Neighborhood Market not accepting WIC Vouchers in its stores. Our argument has basically been two-fold: That not only is the grocer losing valuable sales (a bad business decision) by not taking WIC, it's also failing to be an ethical grocer because there's a pact between nearly all food retailers, particularly those who have it as a mission to serve "neighborhoods," and the U.S. federal and state governments to honor WIC in their respective stores. Since Tesco's Fresh & Easy has "neighborhood" in its name - Fresh & Easy Neighborhood Market - it certainly claims as one of its missions to serve "all" members of the communities and neighborhoods, including those residents who use WIC, where it has its stores.

Fresh & Easy Neighborhood Market CEO Tim Mason was paid about $6.1 million for his services last year. Yet it took him nearly three years from when we first pointed it out to change the policy of not accepting WIC Vouchers at the grocery chain he runs. And opening the store in South Los Angeles in February of this year, which has one of the highest per-capita percentages of WIC users in California, without accepting the vouchers in the first place is...well, priceless.

But starting tomorrow, unless there's a glitch with the store's POS system or some other reason to postpone the WIC acceptance launch, shoppers at the Central and Adams Fresh & Easy store who use WIC will no longer have to go down the street to Superior Grocers to use their vouchers. And over the next few weeks Tesco's Fresh & Easy Neighborhood Market will start to get a good idea of how much sales they've been missing in their stores for over two years by not accepting WIC Vouchers, particularly in the stores like Central and Adams and others located in low-income areas and neighborhoods.

Tesco's Fresh & Easy and WIC - Recent Linkage:

July 16, 2010: South Los Angeles Fresh & Easy Neighborhood Market Store to Accept WIC Vouchers July 29; Additional California Units to Follow

July 7: Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month

February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles

February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

[Editor's Note: Nearly three years ago, Fresh & Easy Buzz first pointed out and reported on the fact that Tesco's Fresh & Easy Neighborhood Market, which opened its first stores in November 2007, didn't accept WIC Vouchers.Additionally, in analysis and commentary pieces beginning in 2008 - and right up until the grocer decided to accept the vouchers at its first store, which will be the Central and Adams unit in South Los Angeles, on July 29 - we've also pointed out in detail how, from both business (added sales) and ethical grocer perspectives, Fresh & Easy was missing the boat by not accepting WIC in its stores. [Suggested reading: September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions and December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary]

Below is a selection of some of those past, and related, stories from Fresh & Easy Buzz:

July 7, 2010: Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month

September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions

December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary

February 10, 2008: Tesco's Fresh & Easy Opens Latest New Store in 'Food Desert' City of Compton, California

July 2008: Tesco's to Open A Fresh & Easy Grocery Market in Low Income, Underserved South Central Los Angeles Neighborhood

March 7, 2009: Analysis & Commentary: The Seven Retail Operations Changes Tesco's Fresh & Easy Neighborhood Market Needs to Make to Help it Get On the Success Track

July 11, 2008: 'Food Desert' Neighborhoods and Southern California: More on the Fresh & Easy Store Planned For South Central Los Angeles

July 15, 2008: Fresh Food to Bloom in An Inner-City Food Desert: Tesco's Fresh & Easy Breaks Ground For New Store in Underserved South Los Angeles Neighborhood

February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles

February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

April 22, 2010: Breaking Buzz: Tesco's Fresh & Easy to Accept WIC Vouchers at its East Adams Store in South Los Angeles

May 14, 2010: Fresh & Easy Neighborhood Market Not Yet Accepting WIC Vouchers at South L.A. Store; No Start Date Set

July 6, 2008: Former NBA Great Earvin 'Magic' Johnson is Working His Business Magic in Urban, Inner City Neighborhoods; We Offer An Idea For Tesco's Fresh & Easy

May 12, 2008: Food Deserts: Coalition to Create 'Blue Ribbon' Commission, Draft Report to Encourage Grocers to Open Stores in Underserved Los Angeles Neighborhoods

February 13, 2008: Leading Democratic Candidate for President Barack Obama Joins Group in Asking Tesco's Fresh & Easy to Put More Stores in Underserved Neighborhoods

June 3, 2008: Fresh & Easy Buzz Redux: Barack Obama to Tesco's Fresh & Easy in Our February 13 Piece: 'Build More Stores in Underserved Neighborhoods'

September 23, 2008: Food Retailing, Society & Economics: 'Food Deserts' and Public Health

March 20, 2009: Federal Government Spending Bill Increases WIC Voucher Program Dollars by $1.2 Billion; 21 Percent Increase

May 28, 2008: Las Vegas Market Report: A 'Food Desert' Neighborhood to Get A New Grocery Store; But it's Not A Fresh & Easy Neighborhood Market

April 27, 2008: New Study Points to Increasing Urban 'Food Deserts' In North America: Locating Stores in 'Food Deserts' A Part of Fresh & Easy's Strategy

March 7, 2008: Former NBA All-Star and Sacramento Native Kevin Johnson is the Driving Force Behind a Fresh & Easy Market in Sacramento's Oak Park Neighborhood

July 29, 2008: Tesco's Fresh & Easy and San Francisco's Tenderloin Redux: Upcoming Developments Offer First Mover Opportunity For Fresh & Easy or Competitors

Friday, July 16, 2010

South Los Angeles Fresh & Easy Neighborhood Market Store to Accept WIC Vouchers July 29; Additional California Units to Follow

[Photo credit: Fresh & Easy Neighborhood Market.]

Breaking Buzz

We reported on July 7, 2010 in this story - Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month - that the Fresh & Easy Neighborhood Market store at 1025 East Adams in South Los Angeles, California (pictured at top) would start accepting WIC Vouchers (Woman, Infant & Children Program) this month.

We can now report that the store, located at Central and Adams in South Angeles, will start accepting WIC Vouchers on Thursday, July 29.

Additionally, Tesco's Fresh & Easy Neighborhood Market will start excepting WIC Vouchers at numerous other Fresh & Easy grocery stores in California - including additional units in Southern California, as well as at stores in the Bakersfield and Fresno regions in the Central Valley - starting 30-45 days after the South Los Angeles store's July 29 start date, Fresh & Easy Buzz has learned. The current internal target date is to have some of the additional stores accepting the vouchers one month from July 29.

Interestingly, read what we wrote in the three paragraphs (in italics) below, from our July 7, 2010 story:

According to our sources, the south Los Angeles store will be the only one of Tesco's current 159 Fresh & Easy stores that will accept the WIC Vouchers for a while. Sort of a test. But if all goes well - and it should since 99% of the grocery stores in California have been accepting WIC Vouchers for as long as the program has existed - its likely Fresh & Easy Neighborhood Market will then start accepting the vouchers in some of its other stores, beginning with those in low-income neighborhoods like in Compton.

Were we Fresh & Easy, we wouldn't wait very long to roll out the acceptance of WIC to all 159 stores. Why wait? It's an accepted method of payment to nearly all grocers in the United States. A number of convenience stores even accept WIC, as do a growing number of farmers markets.

In fact, we suspect once Fresh & Easy sees the nice sales boost it gets at the Central & Adams store on WIC-eligible items (and thus an overall store sales boost) like infant formula, whole milk, juice, eggs, cheese, whole grain breads and cereals, peanut butter, beans and legumes, fresh produce and more, it just might (or at least should) want to accept WIC right away at its other stores.

The Central and East Adams Fresh & Easy market in South Los Angeles will be the first store in the chain of 159 units to accept WIC Vouchers, as we've previously reported.

Including the Bakersfield and Fresno regions in the WIC Voucher-acceptance roll out will benefit Fresh & Easy in the form of added sales at the stores it designates to accept WIC in the two Central Valley regions. In fact, as we've said since 2008, the fresh food and grocery chain should accept WIC at every one of its stores in California, Nevada and Arizona.

Based on a recent analysis we completed of WIC usage patterns at grocery stores in the Central Valley region, we believe Fresh & Easy could increase its overall sales in the Fresno and Bakersfield regions by at least 5% overall by accepting WIC at all the stores.

California's Central Valley has been one of the hardest hit regions in the U.S. in terms of high unemployment and added poverty since the recession hit three years ago. For example, the unemployment rate in the region currently ranges from 15% -to- 20%, depending on the county. That's compared to an overall rate of 12.6% in California. Much of the Central Valley, like South Los Angeles (and other parts of Southern California), also suffers from high non-recession rates of poverty.

Additionally, the Central Valley, including the Bakersfield and Fresno regions, has among the highest percentage of WIC Voucher users in California. The vouchers are distributed by California WIC to low income mothers who qualify. WIC Vouchers can only be used to purchase specific healthy and nutritious food and beverage items, such as infant formula, whole milk, whole grain bread and cereals, juices, fresh produce and other similar items. Learn more about California WIC here.

Every state in the U.S., including Nevada and Arizona where the other Fresh & Easy stores are located, has a program similar to California WIC. Funding for WIC Vouchers is provided to the states primarily by the U.S. Federal Government.

South Los Angeles has a high percentage of WIC Voucher users, as noted in numerous past stories on the topic in Fresh & Easy Buzz.

In fact, employees at the Central and Adams neighborhood Fresh & Easy, which opened in February of this year, for the last five months have regularly had to explain to the numerous customers with WIC Vouchers, that the store - and Tesco's Fresh & Easy Neighborhood Market - doesn't except WIC. Beginning on July 27 the store workers at the South Los Angeles Fresh & Easy market will no longer have to do so. [See - February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles and February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

[Editor's Note: Nearly three years ago, Fresh & Easy Buzz first pointed out and reported on the fact that Tesco's Fresh & Easy Neighborhood Market, which opened its first stores in November 2007, didn't accept WIC Vouchers.

Additionally, in analysis and commentary pieces beginning in 2008 - and right up until the grocer decided to accept the vouchers at its first store, which will be the Central and Adams unit in South Los Angeles, on July 29 - we've also pointed out in detail how, from both business (added sales) and ethical grocer perspectives, Fresh & Easy was missing the boat by not accepting WIC in its stores. [Suggested reading: September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions and December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary]

Below is a selection of some of those past, and related, stories from Fresh & Easy Buzz:

July 7, 2010: Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month

September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions.

December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary

February 10, 2008: Tesco's Fresh & Easy Opens Latest New Store in 'Food Desert' City of Compton, California

July 2008: Tesco's to Open A Fresh & Easy Grocery Market in Low Income, Underserved South Central Los Angeles Neighborhood

March 7, 2009: Analysis & Commentary: The Seven Retail Operations Changes Tesco's Fresh & Easy Neighborhood Market Needs to Make to Help it Get On the Success Track

July 11, 2008: 'Food Desert' Neighborhoods and Southern California: More on the Fresh & Easy Store Planned For South Central Los Angeles

July 15, 2008: Fresh Food to Bloom in An Inner-City Food Desert: Tesco's Fresh & Easy Breaks Ground For New Store in Underserved South Los Angeles Neighborhood

February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles

February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

April 22, 2010: Breaking Buzz: Tesco's Fresh & Easy to Accept WIC Vouchers at its East Adams Store in South Los Angeles

May 14, 2010: Fresh & Easy Neighborhood Market Not Yet Accepting WIC Vouchers at South L.A. Store; No Start Date Set

July 6, 2008: Former NBA Great Earvin 'Magic' Johnson is Working His Business Magic in Urban, Inner City Neighborhoods; We Offer An Idea For Tesco's Fresh & Easy

May 12, 2008: Food Deserts: Coalition to Create 'Blue Ribbon' Commission, Draft Report to Encourage Grocers to Open Stores in Underserved Los Angeles Neighborhoods

February 13, 2008: Leading Democratic Candidate for President Barack Obama Joins Group in Asking Tesco's Fresh & Easy to Put More Stores in Underserved Neighborhoods

June 3, 2008: Fresh & Easy Buzz Redux: Barack Obama to Tesco's Fresh & Easy in Our February 13 Piece: 'Build More Stores in Underserved Neighborhoods'

September 23, 2008: Food Retailing, Society & Economics: 'Food Deserts' and Public Health

March 20, 2009: Federal Government Spending Bill Increases WIC Voucher Program Dollars by $1.2 Billion; 21 Percent Increase

May 28, 2008: Las Vegas Market Report: A 'Food Desert' Neighborhood to Get A New Grocery Store; But it's Not A Fresh & Easy Neighborhood Market

April 27, 2008: New Study Points to Increasing Urban 'Food Deserts' In North America: Locating Stores in 'Food Deserts' A Part of Fresh & Easy's Strategy

March 7, 2008: Former NBA All-Star and Sacramento Native Kevin Johnson is the Driving Force Behind a Fresh & Easy Market in Sacramento's Oak Park Neighborhood

July 29, 2008: Tesco's Fresh & Easy and San Francisco's Tenderloin Redux: Upcoming Developments Offer First Mover Opportunity For Fresh & Easy or Competitors

You can read additional stories on the topic from the archives here

Wednesday, July 7, 2010

Tesco's Fresh & Easy Neighborhood Market to Start Accepting WIC Vouchers at Central & Adams Store in South Los Angeles This Month


Breaking News - Plus Analysis & Commentary

The Fresh & Easy Neighborhood Market store at 1025 East Adams Boulevard (Central & Adams) in south Los Angeles (pictured above) will start accepting WIC Vouchers (Woman, Infant & Children Program) before the end of July, Fresh & Easy Buzz has learned. The start date could come as early as two weeks from today, according to our sources.

Central & Adams Fresh & Easy store employees are set to begin a training program in how to handle the WIC Vouchers - which are distributed by California WIC (and similar agencies in each U.S. state, including Nevada and Arizona, where the other Fresh & Easy stores are located) to low-income mothers and used to buy specific healthy food and beverage items for their children like infant formula, whole milk, whole grain breads and cereals, and fruits and vegetables - starting either late this week or early next week. Once the store's employees complete the brief training program, the south Los Angeles Fresh & Easy market plans to start accepting the paper vouchers, which look similar to paper checks and are handled by grocers at checkout in essentially the same way as they process paper checks.

We first reported in this April 22, 2010 story - Breaking Buzz: Tesco's Fresh & Easy to Accept WIC Vouchers at its East Adams Store in South Los Angeles - that Fresh & Easy Neighborhood Market had decided to start accepting WIC Vouchers at the Central & Adams store in south Los Angeles. We've been writing about the topic since 2008.

Since early 2008 Fresh & Easy Buzz has suggested Tesco's Fresh & Easy has been missing the grocery retailing boat - both from an ethical food retailing perspective as well as from a simple bottom line sales standpoint - by not accepting WIC Vouchers in its stores. [For example, read what we said in this December 2008 piece: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary] There are currently 159 Fresh & Easy units, located in Southern and Central (Valley) California, southern Nevada and Metropolitan Pheonix, Arizona.

Our argument regarding Tesco's Fresh & Easy and it's missing the food retailing boat by not accepting WIC Vouchers has been a simple one:

>First, there exists an ethical compact in U.S. food & grocery retailing between grocers (and their trade organizations) and the government in which it's considered good practice for grocers to accept WIC Vouchers, which enable low-income mothers to provide nutritious foods for the children, which they otherwise most likely would be unable to afford. Virtually every major grocery chain and most independents in America accept WIC VOuchers in their stores.

We've also have pointed out that since Tesco promotes the fact it has some stores in "food desert" neighborhoods, which are generally low-income, inner city areas where residents are underserved by markets that offer fresh food and groceries at decent prices (like south Los Angeles and Compton, for example) but doesn't accept WIC Vouchers at those stores, it's essentially offering "half a loaf" in that many of the residents of those neighborhoods, like south Los Angeles, are low-income mothers who use WIC Vouchers to buy needed foods for the children, but can't use their vouchers at the neighborhood Fresh & Easy store. [See - February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles]

>Second, from a pure business (sales) standpoint, we've argued Fresh & Easy is turning away needed sales, particularly at its stores in low-income areas like south Los Angeles and Compton in Southern California, along with a few others, by not accepting WIC Vouchers. Experienced grocers in the Western U.S. (and elsewhere in the country) know just how much added sales volume accepting WIC Vouchers can bring to a store, particularly those units located in low and lower-income neighborhoods.

Tesco either missed the business (sales) argument of accepting WIC Vouchers completely in its extensive research period prior to launching Fresh & Easy Neighborhood Market in November 2007 - not to mention up until now - or decided to disregard the potential added sales reality of accepting WIC all together, despite the fact that Fresh & Easy needs every single dollar of added sales it can muster.

We charitably suggest the retailer likely missed it completely in its research because it created a policy for Fresh & Easy from the start not to accept any form of paper payment in the stores, including paper personal and payroll checks, WIC Vouchers and paper manufacturers' cents off coupons, although it does accept its own paper store coupons, the $6 off (purchases of) $25 or more and $10 off $50 vouchers it regularly distributes to consumers.

Tesco also installed point-of sale (POS) checkout systems in its stores that don't accept paper checks, manufacturers' coupons or WIC Vouchers, suggesting it was oblivious to the benefits of accepting WIC - not to mention manufacturers' cents off coupons and even paper checks, all of which it still doesn't take in the stores - from the very start.

In fact, it's this very point-of-sale system which in-part has held up Fresh & Easy Neighborhood Market from accepting WIC Vouchers at the Central & Adams store to date, although the system has now been adapted to accept the vouchers, according to store employees.

On May 14, 2010, we reported in this story - Fresh & Easy Neighborhood Market Not Yet Accepting WIC Vouchers at South L.A. Store; No Start Date Set - that the Central & Adams Fresh & Easy store hadn't yet started taking WIC Vouchers. Store employees told a Fresh & Easy Buzz correspondent "some kinks" were still being worked out of the POS system.

California WIC had a moratorium on new retailers accepting WIC Vouchers up until January 2010. That moratorium was lifted in January, according to Melinda Beer, an official with the agency.

Fresh & Easy Neighborhood Market is approved to accept WIC, according to Ms. Beer.

[We're told by our sources that the story linked at the end of this paragraph - and the many past stories on the topic linked at the bottom of this piece - provided an impetus to Fresh & Easy's senior management regarding the decision to accept WIC Vouchers at the South Los Angeles store: February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles.]

In fact, in April, Laurie True, the director of California WIC, told an audience at the United Fresh Produce Association convention in Las Vegas that she was told Fresh & Easy had worked out its problems with the POS systems and was taking (at that time) WIC Vouchers at a store in Compton. She had that store mixed up with the Central & Adams store in south Los Angeles, a simple mistake. However, as we reported in the May piece linked above, that wasn't the case. And of course, it hasn't been the case until now, according to store employees.

However, based on our reporting, that situation should change in the next two -to- three weeks, when Fresh & Easy Neighborhood Market plans to start accepting WIC Vouchers at its store at 1025 East Adams Boulevard in south Los Angeles.

According to our sources, the south Los Angeles store will be the only one of Tesco's current 159 Fresh & Easy stores that will accept the WIC Vouchers for a while. Sort of a test. But if all goes well - and it should since 99% of the grocery stores in California have been accepting WIC Vouchers for as long as the program has existed - its likely Fresh & Easy Neighborhood Market will then start accepting the vouchers in some of its other stores, beginning with those in low-income neighborhoods like in Compton.

Were we Fresh & Easy, we wouldn't wait very long to roll out the acceptance of WIC to all 159 stores. Why wait? It's an accepted method of payment to nearly all grocers in the United States. A number of convenience stores even accept WIC, as do a growing number of farmers markets.

In fact, we suspect once Fresh & Easy sees the nice sales boost it gets at the Central & Adams store on WIC-eligible items (and thus an overall store sales boost) like infant formula, whole milk, juice, eggs, cheese, whole grain breads and cereals, peanut butter, beans and legumes, fresh produce and more, it just might (or at least should) want to accept WIC right away at its other stores.

Additionally, it's important to note that WIC isn't just used by mothers who live in low-income neighborhoods. And in the current economy, people might be surprised at how many mothers in middle-income neighborhoods are relying on WIC to help them feed their children.

With average store market basket sales sizes nowhere near where Tesco wants them to be at present, Fresh & Easy Neighborhood Market would be smart to allow WIC Voucher use at all of its stores as fast as it can.

Further, as we've said in Fresh & Easy Buzz since 2008, not accepting manufacturers' cents off coupons, and to a lessor extent not taking paper personal and payroll checks in the Fresh & Easy stores, are two additional, simple, operational changes the grocer could make that would payoff in the short, medium and long run in terms of added sales - and even more importantly in increasing the customer universe for its stores.

[Readers: Follow the progression of our coverage, via the selected past stories linked below, on the WIC Voucher issue and Tesco's Fresh & Easy Neighborhood Market, from when we first suggested the grocer was missing the boat by not accepting the vouchers, to when we started focusing on why Fresh & Easy should accept them at the south Los Angeles store, which opened in February of this year, to the present.]

September 7, 2008: Analysis & Commentary: Should Tesco's Fresh & Easy Put An Asterisk Next to its Motto? Yes; Unless it Corrects Four Operational Omissions.

December 29, 2008: Tesco's Fresh & Easy, 'Food Deserts' and WIC Vouchers; A 'Year-End' Analysis & Commentary

February 10, 2008: Tesco's Fresh & Easy Opens Latest New Store in 'Food Desert' City of Compton, California

July 2008: Tesco's to Open A Fresh & Easy Grocery Market in Low Income, Underserved South Central Los Angeles Neighborhood

March 7, 2009: Analysis & Commentary: The Seven Retail Operations Changes Tesco's Fresh & Easy Neighborhood Market Needs to Make to Help it Get On the Success Track

July 11, 2008: 'Food Desert' Neighborhoods and Southern California: More on the Fresh & Easy Store Planned For South Central Los Angeles

July 15, 2008: Fresh Food to Bloom in An Inner-City Food Desert: Tesco's Fresh & Easy Breaks Ground For New Store in Underserved South Los Angeles Neighborhood

February 23, 2010: Food Deserts & WIC Vouchers: Half A Loaf For the New Fresh & Easy Store Opening Tomorrow in South Los Angeles

February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

April 22, 2010: Breaking Buzz: Tesco's Fresh & Easy to Accept WIC Vouchers at its East Adams Store in South Los Angeles

May 14, 2010: Fresh & Easy Neighborhood Market Not Yet Accepting WIC Vouchers at South L.A. Store; No Start Date Set

July 6, 2008: Former NBA Great Earvin 'Magic' Johnson is Working His Business Magic in Urban, Inner City Neighborhoods; We Offer An Idea For Tesco's Fresh & Easy

May 12, 2008: Food Deserts: Coalition to Create 'Blue Ribbon' Commission, Draft Report to Encourage Grocers to Open Stores in Underserved Los Angeles Neighborhoods

February 13, 2008: Leading Democratic Candidate for President Barack Obama Joins Group in Asking Tesco's Fresh & Easy to Put More Stores in Underserved Neighborhoods

June 3, 2008: Fresh & Easy Buzz Redux: Barack Obama to Tesco's Fresh & Easy in Our February 13 Piece: 'Build More Stores in Underserved Neighborhoods'

September 23, 2008: Food Retailing, Society & Economics: 'Food Deserts' and Public Health

March 20, 2009: Federal Government Spending Bill Increases WIC Voucher Program Dollars by $1.2 Billion; 21 Percent Increase

May 28, 2008: Las Vegas Market Report: A 'Food Desert' Neighborhood to Get A New Grocery Store; But it's Not A Fresh & Easy Neighborhood Market

April 27, 2008: New Study Points to Increasing Urban 'Food Deserts' In North America: Locating Stores in 'Food Deserts' A Part of Fresh & Easy's Strategy

March 7, 2008: Former NBA All-Star and Sacramento Native Kevin Johnson is the Driving Force Behind a Fresh & Easy Market in Sacramento's Oak Park Neighborhood

July 29, 2008: Tesco's Fresh & Easy and San Francisco's Tenderloin Redux: Upcoming Developments Offer First Mover Opportunity For Fresh & Easy or Competitors