Breaking Buzz: California's Single-Use Plastic Carrier Bag Ban Bill Fails

Going Real-Time

It will continue to be 'paper or plastic' in California's grocery stores

AB 1998, the state legislative bill that would have banned single-use plastic carrier bags in California's grocery stores, retail stores over 10,000 square-feet with pharmacies (in 2012), and convenience stores (in 2013), has failed in the California State Senate.

The vote was 21 members against and 14 in favor of the bill.

The final vote against the plastic bag ban came about 25 minutes before 12 am, which is when the California State Senate is set to adjourn its current legislative session.

As a result of the bill's defeat, California grocery stores will be able to continue to offer single-use plastic carrier bags in their stores, along with paper grocery sacks, accept in city's like San Francisco which have municipal bans against the thin plastic carrier bags.

Failure means more local bag bans

Fresh & Easy Buzz predicts the failure of AB 1998 to pass will open up the floodgates for city and county governments in California to enact single-use plastic carrier bag ban laws.

For example, the city of Santa Monica in Southern California plans to go forward with its proposed plastic bag ban legislation, which it put on hold pending tonight's vote in the California State Senate, a spokesperson for the city told us earlier this week.

Additionally, Los Angeles County, which also put its bag fee or ban legislation on hold pending the vote tonight, also plans to go forward with the bill now that the statewide single-use plastic bag ban bill has failed.

Manhattan Beach, California, which has been in court over its plastic bag ban law for a couple years now, said this week it will continue to fight in court against the American Chemistry Council, which sued the city in 2009 over the law, to enact the law if AB 1998 fails, as it has.

Other California cities considering single-use plastic bag ban laws but put them on hold pending the vote on AB 1998 include Berkeley and Davis, in Northern California, and Los Angeles in the southland, among others.

The California Grocers Association (CGA) supported AB 1998 for just this reason - in order to prevent a patchwork quilt of local bag ban and bag fee laws from occurring.

Ironically, we think the publicity generated by the fight over AB 1998 by supporters and opponents, led by the American Chemistry Council, which represents plastic bag-makers and other companies in the chemical industry, is actually going to serve as a catalyst for cities and counties, many who not only wouldn't have proposed or passed local bans had AB 1998 passed, but also might not have done so at all were it not for the huge amount of attention the legislation has received over the last few months in California.

For the state's grocers, and its trade association, the CGA, this means they will have to decide - and if they decide in the affirmative will have to spend significant time and money - which of the numerous local single-use plastic bag ban (or bag fee) pieces of legislation they will fight, or if they will fight any of them.

Meanwhile, the failure of AB 1998 to pass tonight, despite a number of amendments made to the bill at the last minute in an attempt to gain passage, likely means the appetite in the state legislature to propose and push a similar statewide bill next year is going to be minimal.

We will be offering further analysis on the issue, including the impact of the legislation's failure to pass on Tesco's Fresh & Easy Neighborhood Market, in an upcoming piece.

See the related stories below for details and perspective:

August 31, 2010: It's Down to the Wire in California State Senate For Possible First-in-the-Nation Statewide Single-Use Plastic Bag Ban

August 23, 2010: California's Battle to Ban the Plastic Bag Heats Up in Sacramento: Author of Legislation Says the Reports of its Death Are Greatly Exaggerated

August 20, 2010: Single-Use Plastic Carrier Bag Ban Bill AB 1998 Could Be in Difficulty of Passing in the California State Senate

August 16, 2010: Supporters of California's First-in-the-Nation Single-Use Plastic Bag Ban Going Humorous to Win on the Eve of State Senate Vote

July 20, 2010: California's First-in-the-Nation Plastic Carrier Bag Ban Legislation Looks to Be On its Way to Victory

June 19, 2010: 'Paper or Plastic' Likely to Be Replaced By 'Reusable or Paper' (For a Fee) in California Grocery Stores

[Readers: Fresh & Easy Buzz has been reporting on, writing about, and offering analysis and opinion on the single-use plastic carrier bag, reusable bag, and related topics and issues since early 2008. Click here, here, here and here to read a selection of those posts.]

It's Down to the Wire in California State Senate For Possible First-in-the-Nation Statewide Single-Use Plastic Bag Ban

Going Real-Time

Today is the last day of the current session for the California State Legislature.

Among the pieces of legislation the California State Senate (and California State Assembly) is dealing with right now inside the ornate capital building in Sacramento pictured at top, is a slightly major one: The Golden State's elected leaders have to date failed to pass a state budget. The budget is now over 60 days late, in fact.

But right now (7 pm pacific time), the issue that's hot and heavy in the California State Senate, which is set to adjourn in five hours at 12 am, is AB 1998, the bill that if passed and signed by the Governor will ban, beginning in 2012, the use of thin, single-use plastic carrier bags in California's grocery stores, retail stores over 10,000 square-feet with pharmacies, and (in 2013) in convenience stores and small grocery markets.

California Governor Arnold Schwarzenegger supports AB 1998 and has said he will sign it if the California State Senate passes it.

The California Grocers Association (CGA), which is the trade group for California's chain and independent grocers, supports the single-use plastic bag ban bill, as we've previously reported. The legislation allows grocers to sell paper grocery sacks for a minimum of five cents each. The paper bags must be made out of 40% recycled paper. The law would also permit stores to offer thicker plastic shopping bags, as long as they are deemed reusable. Additionally, AB 1998 upholds the current legal requirement that grocers sell reusable shopping bags in their stores.

AB 1998 passed the California State Assembly in June. The full California State Senate started debate on the legislation yesterday - and continues to do so at present.

The bill has been amended by its author, Assemblywoman Julia Brownley, D-Santa Monica, in an attempt to gain the needed votes from California State Senate members who've been on the fence.

Most significantly, Brownley and her supporters in the legislature removed a provision of AB 1998 that would have required grocers to charge a minimum of five cents each for paper grocery bags. The proceeds of the bag sales, reagrdless of the price charged by grocers and other retailers, would have gone entirely to the retailers.

Under the revised bill, retailers would be allowed to charge only what it costs them to buy paper bags. Additionally, grocers would be required to provide free paper bags to shoppers who rely on government assistance.

Another key amendment to AB 1998 designates $2 million from an existing recycling-promotion fund to be used to help single-use plastic carrier bag manufacturers modify their plants to produce reusable plastic bags using recycled content.

If AB 1998 passes the Senate before 12 am tonight, the California State Assembly will have to approve the amendments before sending it to Governor Arnold Schwarzenegger for his signature.

The amendments though aren't proving to be a guarantee of the bag ban legislation's passing in the California State Senate.

A short while ago, opponents of the bill made a procedural move, which sent AB 1998 back to the Senate Appropriations Committee. This is law-making in real-time folks - which is similar to watching sausage being made but without having to wear a hard hat, although the safety hats should be required on the California State Senate floor right now. Supporters of the bill are at present trying to get the legislation out of committee and back onto the floor of the full California State Senate for a vote.

Lobbyists for both sides have been offering perks to the pols for weeks. As we write this many "advocates" are elbowing senate members, trying to persuade the undecided to vote their respective ways, adding sweeteners like campaign donations and more to the pot if they do so.

We're watching and reporting on the process closely at our @FreshNEasyBuzz Twitter.com feed. You can view it - and our "real time" tweets on the process - at the screen on the right, as well as at our Twitter feed.

The California State Senate has five hours to vote on the plastic bag ban bill.

If no vote is taken before thes stroke of midnight, when the current legislative session ends, the bill essentially goes away. In other words, a new bill will have to be reintroduced in the next legislative session and make its way once again through all of the relevant committees in the California State Assembly and State Senate.

More to come. Stay tuned. Follow our reports on Twitter.

Recent related stories in Fresh & Easy Buzz

August 23, 2010: California's Battle to Ban the Plastic Bag Heats Up in Sacramento: Author of Legislation Says the Reports of its Death Are Greatly Exaggerated

August 20, 2010: Single-Use Plastic Carrier Bag Ban Bill AB 1998 Could Be in Difficulty of Passing in the California State Senate

August 16, 2010: Supporters of California's First-in-the-Nation Single-Use Plastic Bag Ban Going Humorous to Win on the Eve of State Senate Vote

July 20, 2010: California's First-in-the-Nation Plastic Carrier Bag Ban Legislation Looks to Be On its Way to Victory

June 19, 2010: 'Paper or Plastic' Likely to Be Replaced By 'Reusable or Paper' (For a Fee) in California Grocery Stores

[Readers: Fresh & Easy Buzz has been reporting on, writing about, and offering analysis and opinion on the single-use plastic carrier bag, reusable bag, and related topics and issues since early 2008. Click here, here, here and here to read a selection of those posts.]

Small-Format Butcher Shop-Grocer 'The Meat House' Has Big Growth Plans For Southern California

Inside The Meat House's Costa Mesa, California store, which opened in January 2010. Click on the photo to enlarge it. You can view additional photographs of the Costa Mesa store here.

Southern California Market Region Report: Format Bending

A fast-growing, small-format (the stores average 3,500-4,500 square-feet) butcher shop and grocer new to the Western U.S. and California has plans to open numerous stores in Southern California over the next few years, along with elsewhere in the U.S., Fresh & Easy Buzz has learned.

The grocer is The Meat House, which opened its first store in Portsmouth, New Hampshire in 2003, just a few months after it was founded in 2002 by partners Justin Rosberg, a former Bear Stearns investment banker, and Jason Parent, a restaurant industry veteran. The retailer is headquartered in Portsmouth. Rosenberg holds the title of CEO. Parent is president.

The Meat House, which currently has 25 stores in eight states - New Hampshire (8 units), Massachusetts (7), Maine (4), North Carolina (2), New York (1), Connecticut (1), Texas (1) and Southern California (1) - opened its first California store in Costa Mesa in January of this year.

The retailer operates on a mixed corporate ownership-franchise basis, although it doesn't grant any single-store franchises. Instead, any franchise holder excepted must open a minimum of four stores in a given area. The Costa Mesa store (at 103 East 17th Street) is one of those franchise operations, owned by partners Brian Smith and Robert Hagopian. Both live in nearby Laguna Beach.

About 60% of the current 26 stores are corporate-owned. The food retailer only created its franchise option in February of this year. It says it currently has territory agreements with franchise partners for at least 125 new stores in 11 states.

Two new Southern California stores - with more to come

The Meat House is preparing to open two more stores in Southern California - in Mission Viejo and in Brea, our source at the company tells us. Plans are to open both stores before the end of this year.

Additionally, numerous other The Meat House stores are on the drawing board for Southern California over the next few years.

The full-service butcher shop in a typical 3,500-4,500 square-foot The Meat House store. The full-service counters generally have more than one butcher working behind them regularly.

More than a butcher shop: A small-format grocer

Like the name says, The primary merchandising focus of The Meat House is fresh meat and poultry, merchandised in full-service meat cases similar to the old-fashion neighborhood butcher shop, which the format is modeled after, although with a modern day twist or two. The retailer describes the format as "a modern revival of the neighborhood butcher – only better."

In addition to fresh meats and poultry, the markets offers a deli featuring fresh-prepared foods and other items, a specialty cheese section, fresh produce, fresh baked goods, a wine and craft beer selection, and an assortment of shelf-stable specialty and gourmet grocery products in the center of the store.

In its specialty foods and grocery section, the retailer puts an emphasis on locally-produced items. For example, many locally-produced products offered in the Costa Mesa store aren't offered in the New Hampshire or other stores. Instead, a selection of grocery items locally-produced in those regions are offered in those stores. Localization.

Trends

The Meat House has a few current trends in its favor. One is the currently hot trend towards butchers and butchering, in which many consumers are preferring to buy their meat un-packaged from an "old fashion" butcher shop rather than buying pre-packaged meat at the supermarket.

Fueling this trend are both food safety-oriented and local/neighborhood concepts. The idea of knowing your butcher, and where he gets his meat, is appealing to many shoppers today, as it was before pre-packaged meat became the merchandising norm in the U.S. More and more U.S. supermarkets, for example, are offering full-service, butcher-style meat cases, along with pre-packaged self-service cases.

The face-to-face interaction with the butcher also is part of the appeal for these "back-to-the-future" grocery shoppers. The Meat House puts a high premium on this type of customer - or butcher-to-customer - service in its small stores.

Many consumers have also become interested in do-it-yourself (DIY) butchering. These folks range from the hardcore, those who are taking classes and learning how to butcher a whole animal, to those who just want to purchase primal cuts from the butcher and do the finishing work at home, which also can be a money-saver for consumers.

Time magazine captured the growing trend in a piece earlier this year, 'DIY Butchering,' which you can read here.

Numerous forecasters have named the DIY butchering trend as one of the top five food trends for 2010, in fact. Fresh & Easy Buzz has followed the trend closely - and agrees it's extremely popular today - and appears to be growing, as part of the local food and personal food knowlege movements.

The writings of Michael Pollan, including his best-selling book, 'The Omnivore's Dilemma,' have also helped fuel the trend of consumers wanting to know more about where their meat comes from and wanting to have a hand in the process, even if it only means having a regular butcher to interact with over the counter on a regular basis.

The Meat House offers various in-store classes and other events geared towards informing shoppers about where it procures its meat, how customers can purchase better quality meat, and how they can prepare it. The goal is to forge a relationship between shoppers and The Meat House's store employees, especially the butchers, something the independent neighborhood butcher and grocer have, and generally still are, the best at doing.

It will be interesting to observe how well The Meat House can do that as a chain, particularly as it grows it number of stores. The franchise ownership aspect is an attempt to enhance that local aspect. The company's long-term goal is to have only about 20% of the total number of stores corporate-owned, with the 80% eventually being owned by locally-based franchisees.

The Meat House, like Tesco's Fresh & Easy Neighborhood Market and many other grocers and other types of retailers, also is counting on the growing ready-to-eat and ready-to-heat fresh-prepared foods trend to aid it in its growth and success. The stores offer fresh-prepared foods of various types and also offer all sorts of value-added items and concepts - marinades, rubs, simple recipes - to make preparing the meats they offer easy to do at home.

By offering prepared foods, fresh produce, bakery, wine and the other departments and product selections in the small stores, which range so far from downtown storefront locations to suburban centers, the grocer also is attempting to cater to more than just the meat needs of shoppers. This is essential, in fact, because by offering a variety of food products complementary to meat - bread, produce, wine, ect. - in the stores, the retailer has a better chance of increasing the average market basket size purchases by customers, which is a key indicator (higher the better) for the success of any food and grocery retailer regardless of store size, than it would by merely offering meats and poultry alone.

The Meat House stores, which the company like to call a "modern revival" of the corner butcher shop, could also tap into another growing trend in the U.S. - nostalgia - which can be described as a yearning for something from the past. Many shoppers, including those who are to young to have ever experienced the corner meat market unless they grew up in a traditional U.S. big city like New York, Philadelphia, Chicago or San Francisco, for example, like the idea of going "back-to-the-future" for shopping, hence in part the growing popularity (along with cost) of flea markets, second hand stores, farmers markets, and even corner mom & pop grocery stores. We suspect The Meat Market would like to see such a trend blossom.

Costa Mesa 'The Meat House' Reviews

In the eight months since it's been open, the Costa Mesa, California The Meat House unit has received 34 reviews on the popular Yelp.com review site. All 34 of the review are positive - and many of the customer reviews are darn right gushing. You can view the reviews here.

There's a lot of vacant commercial space in Southern California. And at just 3,500 -to- 4,500 square-feet, the start up costs of opening a The Meat House store are relatively low.

The stores also, because of their format and size, can be located in urban and suburban areas. As such, Southern California appears to present a good opportunity for the retailer's growth plans. The region's strong food culture also could be a good match for The Meat House's offering.

After the two new stores - Mission Viejo and Brea - open, the fast-growing butcher and grocer has plans to open additional units in the region in 2011. The Meat House is also looking to Northern California for stores in the not to distant future, along with additional states beyond the current eight. The competition is strong - but the butcher shop-food retailer may have found a niche it can continue to fine tune and localize for success?

Fresh & Easy Neighborhood Market Expanding its fresh&easy 'goodness' Co-Branded Line; Launching Numerous New Items

Fresh & Easy Neighborhood Market has redesigned the labels of its fresh&easy 'goodness' line. Products with the new design are set to hit the 159 Fresh & Easy stores this week. Pictured above is the original package.

Private Brand Showcase

Tesco's Fresh & Easy Neighborhood Market is expanding its co-branded fresh&easy 'goodness' snack line, adding a number of new items to the line, which is positioned primarily as a healthy meal and snack solution for kids.

The line's product packages are designed to fit into lunch bags or boxes for school. Of course, the snack items aren't exclusively for kids. The packaging sizes are convenient for adults as well, whether for at home consumption or for taking in sack lunches to the workplace.

The line, which was introduced about this time last year, with the (refrigerated) turkey and cheddar snack tray item pictured at the top, is co-branded, featuring the fresh&easy brand name in the upper left hand corner and the 'goodness' brand name more prominently on the package. The grocery chain uses fresh&easy as its primary private brand or label. It uses other private or retailer brands like eatwell (fresh-prepared foods and dry grocery), Mother's Joy (a line of breakfast cereals) and Buxted (value-priced fresh poultry and meat).

Among the new fresh&easy 'goodness' SKUs being introduced include: breakfast cereals, applesauce, snack chips, raisins and beverages, among others, Fresh & Easy Buzz has learned.

The official new item launch is September 15. However, many of the new items are set to start arriving in the stores this week.

End-cap merchandising

Starting this week, Fresh & Easy plans to feature the new fresh&easy 'goodness' kids' snack items on dedicated end-caps in its 159 stores, as a way to introduce the new items, along with taking advantage of the back-to-school season from an in-store merchandising perspective.

The items in the product line contain no artificial preservatives, flavors or coloring.

New packaging graphics

Fresh & Easy has also redesigned the packaging graphics for its co-branded fresh&easy 'goodness' line. Those changes include the new and existing items. The new look will be debuting as the products start showing up in the stores this week.

According to our information, the line will continue to be co-branded, featuring both the fresh&easy and 'goodness' brand names.

Lunchbox-sized kids' snacks is a fast-growing segment, led by items like Kraft Foods' (refrigerated) Lunchables line, which the original fresh&easy "goodness" snack tray is similar to, along with numerous refrigerated and dry grocery products packaged in kid-friendly and lunchbox sizes - ranging from raisins, applesauce, peanut butter and yogurt, to chips, juices and much more.

Fresh & Easy Neighborhood Market's expansion of the fresh&easy 'goodness' brand and line is clearly designed to take advantage of the growing segment, using its own brand.

Since September 15 is the official kick-off for the new items, we suspect Tesco's Fresh & Easy to announce the expansion of the line and new item introduction either this week, or at least a week before the official launch date. Of course, if you read Fresh & Easy Buzz, you just learned about it.

We think introducing the new fresh&easy 'goodness' items on dedicated end-caps is a good idea, particularly since school has just started in California, Nevada and Arizona, where Tesco has its 159 Fresh & Easy Neighborhood Market stores. The new items will be cross-merchandised on the end-caps with other types of back-to-school items.

Recent Private Brand Showcase stories in Fresh & Easy Buzz:

August 18, 2010: Fresh & Easy Neighborhood Market Extending 'eatwell' Healthy Foods' Private Brand Into Dry Grocery Category

July 21, 2010: 'Sipsational' & 'Quenchtastic': Safeway Introduces New 21-Flavor Line of Soft Drinks Under 'refreshe' Private Brand

July 17, 2010: New Fresh & Easy Neighborhood Market Clock-Shaped Private Brand Candy Line Hits the Shelves at Fresh & Easy

July 12, 2010: Tesco Launches Private Brand 'Lasagne Sandwich' in the UK Today...With No Apologies to The Earl of Sandwich

June 24, 2010: New Fresh & Easy Clock Logo-Shaped Candies Are A Pretty Sweet Idea

May 11, 2010: Tesco Might Want to Get 'fresh & naked' at 'fresh & easy'

April 2, 2010: Fresh & Easy's New 'EatWell' Healthier Fresh, Prepared Foods Brand to Hit Stores on April 7

April 11, 2010: When it Comes to Fresh, Prepared Foods, New York City's Duane Reade is Simply 'deLish' for Walgreens

February 22, 2010: Food, Drug Retailers With Stores in California, Nevada & Arizona Honored for Private Label-Store Brands' Excellence

May 18, 2009 piece - Strategy Session: Tesco's Fresh & Easy Needs to Move From its One Store Brand Fits All Strategy to A 'Three Brand' Store Brand Strategy

March 9, 2009: An English Village, A British Fresh Chicken Brand and Tesco Fresh & Easy's New 'Buxted' Discount Fresh Meat Brand: What Do All Three Have in Common?

Smart & Final's First California SmartCo Foods Store to Be in Southern CA City of Lake Forest

Pictured above is the existing Smart & Final non-membership warehouse store and the vacant Office Depot store building (to the right) next door, in the Twin Peaks Plaza shopping center in Lake Forest, (Southern) California. Smart & Final bought the Office Depot building. It's combining the two spaces into one in a major renovation. The combined space will create an about 41,000 square-foot SmartCo Foods store. [Photo credit: City of Lake Forest, California.]

Southern California Market Region Report

Fresh & Easy Buzz has been following and reporting on the launch by Southern California-based food and grocery retailer Smart & Final of its new-format SmartCo Foods stores in the Metropolitan Denver, Colorado region closely. Smart & Final has opened five SmartCo Foods stores so far in Metro Denver.

For example, read our series of stories linked below:

>Tuesday, August 17, 2010: And Then There Were Five: Smart & Final Completes its Mission of Opening Five SmartCo Foods Stores in Metro Denver Before Summer Ends

>July 14, 2010: Smart & Final Opens Second SmartCo Foods Store Today in Metro Denver, Colorado

>June 28, 2010: Smart & Final to Open its New Format SmartCo Foods Stores in California and Arizona

>June 29, 2010: A Pictorial Look Inside Smart & Final's First SmartCo Foods Store in Denver, Colorado

Smart & Final says it plans to open a total of 20-25 of the 41,000 -to- 60,000 square-foot hybrid supermarket/non-membership warehouse/farmers market-style markets in the Denver region over the next few years.

In the June 28, 2010 story linked above, we reported that Smart & Final plans to open SmartCo Foods stores in California and Arizona this year, as well as in Metro Denver.

The first California SmartCo Foods store will be in the south Orange County city of Lake Forest, in Southern California, in the Twin Peaks Plaza shopping center at 23601-23641 El Toro Road.

The store is going into an existing Smart & Final non-membership club store the retailer is renovating, along with a vacant Office Depot big box building next door, which Smart & Final has acquired. When the renovation is completed, the combined two spaces will create a SmartCo Foods store of about 41,000 square-feet, which is similar in size to the smallest of the five stores currently open in Metro Denver. Those five stores are in former Albertsons supermarket buildings.

Smart & Final plans to open the SmartCo Foods store before the end of this year. However, depending on the pace of the current major renovation, it may not open until early 2011.

Lake Forest has a population of about 74,000. According to the City of Lake Forest the city's demographics break down like this: White 49.28%; Hispanic 22.53%; Asian 11.56%;
Black 1.96%; and Other 14%.

The city has a high median household income of $94,107. The popular and affluent planned communities of Foothill Ranch and Portola Hills are part of the city of Lake Forest.

As we've said in the pieces linked near the top, the addition of the SmartCo format and banner to the Southern California market will add yet another layer of competition to what's an already very competitive region when it comes to food and grocery retailing. Additionally, Orange County, which has been a major focus for Tesco's Fresh & Easy Neighborhood Market in Southern California, is one of the most grocery-stored and competitive sub regions within Southern California.

Smart & Final is currently looking for additional locations for its SmartCo Foods stores in Orange County and elsewhere in Southern California.

Additionally, as we've previously reported, plans are to open SmartCo stores in Metropolitan Phoenix, Arizona, which is one of Fresh & Easy Neighborhood Market's four market regions, with its current 159 stores. The other regions are: Southern California; California's Central Valley; and Metro Las Vegas, Nevada.

Tesco plans to open its first Fresh & Easy stores in Northern California early next year. [Read - August 21, 2010: April 2010 Prediction Correct: February 2011 Target to Open First Eight Fresh & Easy Neighborhood Market Stores in Northern California and Tesco Will Open its First Eight Fresh & Easy Neighborhood Market Stores in Northern California in 'Early 2011']

Smart & Final is also looking for sites in Northern California for its SmartCo Foods stores. In addition, Smart & Final-owned Henry's Farmers Market opened its first store in Northern California on August 18 in Elk Grove, which is near Sacramento. [See - August 17, 2010: Henry's Farmers Market 'Beats' Fresh & Easy Neighborhood Market to Northern California Despite Multi-Year Head Start; Elk Grove Store Opens Tomorrow

What's Up With Joe? Texas Grocer H-E-B Planning 'Major Announcement' About its Joe V's Smart Shop Soon

New Format Development in the 21rst Century

We've been closely following Texas-based grocer H-E-B's Joe V's Smart Shop price-focused discount grocery store in Houston, Texas (12035 Antoine Drive) since before it opened in May of this year for four main reasons. Those reasons are:

H-E-B is among a handful of the best food and grocery retailers in the United States - and globally. Number two follows from that premise, which is that anything new H-E-B does - particularly when it's a brand new discount grocery store format like Joe V's, discount grocery retailing being something that H-E-B doesn't specialize in - warrants close following by any serious food and grocery retailing analyst and publication. Third: New formats matter. Innovation matters. And lastly, we plain just love new formats.

Below are our past stories about H-E-B's Joe V's Smart Shop:

>May 5, 2010: H-E-B Opens Joe V's Smart Shop Discount Prototype Grocery Store in Houston TX ... But Where's Joe?

>May 6, 2010: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name

>May 20, 2010: H-E-B Tweaking Product Assortment at Joe V's Smart Shop Discount Grocery Store in Texas Opened May 5

>May 20, 2010: 'The Insider': Welcome to Discountopia USA

Inside Joe V's Smart Shop in Houston Texas: Joe V's has all of the traditional supermarket grocery and fresh foods departments. The format features a limited-item selection. The focus is on everyday low price, although H-E-B has a weekly advertising circular for Joe V's, offering specials. The Joe V's Smart Shop format also features price-focused in-and-out deals on non-foods items, like the comforters pictured above.

As you can see, it's been three months since we last wrote about Joe V's Smart Shop. But we've been following the store's development closely - perhaps closer than any other food and grocery retailing publication out there.

And something 'Big' is is about to happen in Joe V's land, deep in the heart of Texas.

That something big is a soon to be made "Major Announcement" by H-E-B about its Joe V's Smart Shop, according to Joe V's general manager Jose (Joe) Villarreal, who might or might not be the "Joe" behind the name of the start up, price-focused grocery chain's name? Or as he likes to day about Joe V's: "Are you ready to deliver the best Price Format Store in Texas"

Mr. Villarreal is sworn to secrecy in terms of publicly declaring he is that Joe. Therefore readers, you'll have to make your own determination on the judgement for now.

Jose (Joe) Villarreal is also sworn to secrecy on the content of what he says will be this upcoming "Major Announcement." But he says it will be "Big" - and that it's coming soon.

Unable to pry anything further out of the man outside of resorting to water boarding, Fresh & Easy Buzz has decided to attempt to predict what the upcoming "Major Announcement" from H-E-B about its Joe V's Smart Shop just might be. Our five predictions go from most likely to least likely below:

1. H-E-B will announce it plans to open a second Joe V's Smart Shop store in the Houston, Texas region.

2. H-E-B will announce it's settled the trademark law suit filed by grocer Trader Joe's - in which TJ's argues the Joe V's Smart Shop name is an infringement on the Trader Joe's name, asking a court to order H-E-B to cease from using the Joe V's name for the store - and therefore can continue using the Joe V's Smart Shop name for the chain.

See: Say it Ain't So Joe: Trader Joe's Tells H-E-B's Joe V's Smart Shop to Change its Name. The case is still in court. The court has permitted H-E-B to continue using the Joe V's Smart Shop name until the case is settled or a decision ordered by the court.

3. H-E-B will announce it will change the name from Joe' V's Smart Shop to something else. See number two.

4. H-E-B will announce it plans to open a second Joe V's Smart Shop store in Texas, but outside of the Houston Metro region.

5. Jose (Joe) Villarreal will announce (perhaps at a "Major" press conference) that he is indeed the "Joe" behind the Joe V's Smart Shop name. An executive of Trader Joe's, attending the press conference, will shout: "Say it ain't so - Joe," over and over again, following Joe Villarreal's announcement.

Since the announcement is coming soon, we encourage the many food and grocery retailing experts and keen industry observers who read Fresh & Easy Buzz to chime in using the comments link below.

Which one of our predictions do you think is correct? None? What's your prediction?

Going Rural: New Fresh & Easy Neighborhood Market Store Planned for Sutter Creek in Northern California

Above is the parcel in the Sutter Creek Crossroads center where Tesco plans to build a Fresh & Easy Neighborhood Market store. Notice the close proximity to the Walgreens, which is opening today. [Photo credit: Photographs exclusive for Fresh & Easy Buzz by Anthony Spinetta.]

Northern California Market Special Report

Tesco's Fresh & Easy Neighborhood plans to build a store in the Northern California town of Sutter Creek, in the Sutter Creek Crossroads shopping center being developed by Sacramento, California-based Petrovich Development Company. The center is at Hwy 104 and Hwy 49.

Sutter Creek, a small town of about 2,500 that's often called the 'Jewel of the Gold Country,' is 47 miles from Sacramento, in Amador County near Jackson, in Northern California's historic Gold Country region. The town takes its name from John A. Sutter who owned the sawmill in nearby Coloma where gold was first found in the Mother Lode region in January of 1848, ushering in the California Gold Rush.

Petrovich Development company says the Sutter Creek Crossroads shopping center is designed to draw from a ten-mile radius. The population within the 10-mile radius of the center is about 29,500. It includes the nearby towns of Jackson and Martel, as well as an unincorporated area.

The Sutter Creek Planning Commission and City Council are currently considering a couple amendments recently presented by representatives of Petrovich Development Company that are required in order for the future Fresh & Easy store to be built. The amendments to the developer's plans, which were drawn up long before Fresh & Easy was considering the location, involve basic things like boundary lines and drainage issues, according to the Sutter Creek Planning Commission.

The planned Tesco Fresh & Easy market is to be located on an about 14,000 square-foot parcel (pictured at top) across from a new Walgreens drug store, which is set to open today, in the Sutter Creek Crossroads center.

According to our sources, Tesco has either already bought the parcel in the shopping center or plans to do so soon. Tesco's Fresh & Easy Neighborhood Market bought a parcel from Petrovich Development some time ago in Elk Grove, California, at Florin & Calvine, for a future store in the Sacramento suburb. It's one of the two Elk Grove stores in the original 19 stores in the Sacramento/Vacaville region announced by the grocery chain in 2008.

Tesco's Fresh & Easy has yet to begin construction on that El Grove store. Based on our information, we don't expect the grocer to start construction on the Sutter Creek unit this year. Of the eight Northern California stores Tesco plans to start opening early next year, none are in the Sacramento region. As such, the grocer has plenty of stores - 19-plus units in the region - that have been in the pipeline since early 2008 to open before it begins construction on future units like Sutter Creek.

[Read our August 21, 2010 story: April 2010 Prediction Correct: February 2011 Target to Open First Eight Fresh & Easy Neighborhood Market Stores in Northern California; and August 19, 2010 report: Tesco Will Open its First Eight Fresh & Easy Neighborhood Market Stores in Northern California in 'Early 2011;' for details on Fresh & Easy Neighborhood Market's planned 2011 Northern California launch.]

The Walgreens Drug store opening today is the first major retail store in the Sutter Creek Crossroads shopping center, as you can see in the photograph above.

A Safeway supermarket, which opened in 2006 in the nearby town of Martel, is about a mile away from the center and future Fresh & Easy store, and a Save Mart supermarket is located just slightly farther away on Highway 88 ,near Martel.

The towns of Sutter Creek, Jackson and Martel are all close together. Jackson and Martel get grocery shoppers from Sutter Creek because Sutter Creek-proper has no supermarkets, according to Anthony Spinetta, a veteran of the food and beverage distribution business in the area and a resident of Sutter Creek.

"The town of Sutter Creek contains only one independent convenience store and no other grocery store or supermarket of any sort," Spinetta says. "There used to be an independent grocer across the street from the Fresh and Easy site, but that grocery store closed at least ten years ago. Fresh and Easy will compete directly for business with Safeway and Save Mart for the city of Sutter Creek and the many households on Ridge Road to the east."

"The entire Jackson/Sutter Creek area is probably overbuilt in terms of supermarket square footage per-capita," Spinetta says. "The Jackson city limits include a full line Raley's, and a Cost Less Foods discount supermarket. Safeway moved their store from Jackson to the current site in Martell due to the obsolescence of their Jackson store and a lack of suitable parcels for relocating within the city. Martell includes the fairly new Safeway, a Kmart, which is dying a slow death but still open, a Walmart that's steadily increasing its food selection, the Save Mart, and now the proposed Fresh and Easy." Cost Less Foods Company is a nine-store, privately-owned grocery chain based in Modesto, California.

The Sutter Creek location demonstrates what Fresh & Easy Buzz wrote about over a year ago, which is that Tesco's Fresh & Easy is following an urban, suburban and rural/small town store location strategy in Northern California. For example, most recently, in May, we reported on a planned Fresh & Easy Neighborhood Market location in the city of Los Banos - May 29, 2010: Going Rural: Fresh & Easy Neighborhood Market to Build First Store in Los Banos, California - which is a city in a rural part of the Central Valley.

In our August 21 piece - April 2010 Prediction Correct: February 2011 Target to Open First Eight Fresh & Easy Neighborhood Market Stores in Northern California - we said Tesco will continue to acquire future Fresh & Easy store sites in Northern California prior to opening its first eight stores in early 2011. The Sutter Creek location in the latest one - and there are more to come. Stay tuned.

Below are the stories thus far in our '2010 Northern California Market Special Report' series:

August 23, 2010: Hybrid 'Good Eats' Market-Cafe From Raley's CEO Michael Teel & Company Opens Today in Sacramento CA

August 22, 2010: The Insider: Challenges & Opportunities: Tesco's Fresh & Easy Neighborhood Market Will Supply its Northern CA Stores From its Riverside County DC in Southern CA

August 21, 2010: April 2010 Prediction Correct: February 2011 Target to Open First Eight Fresh & Easy Neighborhood Market Stores in Northern California

August 19, 2010: Tesco Will Open its First Eight Fresh & Easy Neighborhood Market Stores in Northern California in 'Early 2011.'

August 17, 2010: Henry's Farmers Market 'Beats' Fresh & Easy Neighborhood Market to Northern California Despite Multi-Year Head Start; Elk Grove Store Opens Tomorrow

July 29, 2010: Tesco's Fresh & Easy Neighborhood Market Putting Together List of Managers Interested in Transferring to Northern California

July 25, 2010: Safeway to Start Construction on New Pleasanton, California Flagship Store Soon; Thanksgiving 2011 Target Opening

July 22, 2010: 'The Insider' - After Four Years in the High Weeds in Northern & Central California, Kroger Co. is Emerging to Grow its Foods Co Chain

July 21, 2010: Vacant Fresh & Easy Neighborhood Market Store in Pacifica, California Has the City's Mayor in a Pickle

July 18, 2010: 'The Insider' - When it Comes to Northern California - its Competitors are Rome Burning and Tesco's Fresh & Easy Neighborhood Market is Nero Playing the Fiddle

July 14, 2010: Tony Bennett Has Nothing on Whole Foods Market When it Comes to Loving San Francisco...That City By the Bay

July 6, 2010: Walmart Looking for Store Sites in Northern California For 20,000 Sq-Ft Neighborhood Market by Walmart Prototype Store

June 28, 2010: Smart & Final to Open its New Format SmartCo Foods Stores in California and Arizona

June 26, 2010: Tesco Planning to Announce in July When First Northern California Fresh & Easy Neighborhood Market Stores to Open

June 14, 2010: Newly-Named Whole Foods Market CO-CEO Walter Robb Comes Full Circle With the Opening of the New Store in Mill Valley CA

June 5, 2010: Sprouts Farmers Market Opens First Northern California Store in Sunnyvale; Strikes Up Partnership With Local Non-Profit Farm

May 29, 2010: Going Rural: Fresh & Easy Neighborhood Market to Build First Store in Los Banos, California

May 28, 2010: First Phase of Fresh & Easy Neighborhood Market-Anchored Condo Development in San Francisco's Bayview Set For Completion in June

April 19, 2010: Tesco Debating Whether to Launch Fresh & Easy Into Northern California This Fiscal Year... or Wait

May 9, 2010: A Whopping 15 of Whole Foods Market's 41 New Stores in Development are in California - And Nine of The 15 Are In Northern CA

May 8, 2010: Sprouts, and Likely Henry's to Beat Fresh & Easy to Northern California Despite it's Big Head Start

May 6, 2010: Going Smaller & Getting 'Hybrid': Walmart's Smaller Supercenter in Vacant Retail Buildings Strategy Began in 2008

April 19, 2010: Tesco Debating Whether to Launch Fresh & Easy Into Northern California This Fiscal Year... or Wait

[Also: click here , here and here for a selection of past stories on Fresh & Easy and Northern Calfornia.]

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

Breaking Buzz: California

California Assembly Bill 1060, (AB 1060), which bans the sale of alcoholic beverages at self-service checkout counters in grocery stores and all other types of retail stores offering alcoholic beverages for sale, passed in the California State Senate yesterday. The vote was 22 -to- 12 in favor.

[Read our August 15, 2010 story: Bill to Ban Alcoholic Beverage Sales at Self-Service Checkouts Would End 'Self-Service Only' at California Fresh & Easy Neighborhood Market Stores for background and details on the legislation.]

The bill now goes to California Governor Arnold Schwarzenegger, either for his signature or veto. If the Governor signs AB 1060, it will become law in the Golden State. The Governor hasn't said whether he plans to sign or veto the bill.

The California Grocers Association (CGA), the trade group for chain and independent grocers in California, is asking the Governor to veto the self-service checkout alcoholic beverage ban bill. The bill passed in the State Assembly earlier this year.

Today, CGA president Ronald Fong said in letter to the governor and in a statement: "Assembly Bill 1060 presents itself as feel good legislation but in reality is about punishing innovation and protecting union dues. Its target is one non-union grocer which utilizes an assisted checkout system as its primary form of finalizing customer sales."

Of course, supporters of the bill, which include the popular Mother's Against Drunk Driving (MADD) organization, think it's much more than "feel good" legislation.

The non-union grocer Fong is referring to is Tesco's Fresh & Easy Neighborhood Market, which offers self-service checkout only in its 159 stores, including the 98 in California. The other stores are in Metropolitan Las Vegas, Nevada (27 units) and Metro Phoenix, Arizona (34 stores.)

When the first version of AB 1060 was introduced by Assemblyman Hector De La Torre (D-South Gate), who's also the author of AB 1060, into the California State Legislature in 2008 as AB 523, Fresh & Easy Buzz named the legislation the "Tesco Fresh & Easy Law" because if it does become law, Fresh & Easy Neighborhood Market would be the only grocery chain in California that would be significantly affected by it since it's the only chain we're aware of that offers self-service checkout only. A number of other chains offer self-service checkout but do so as an option, along with having full-service checkout, in the stores. The fact CGA's Fong singled out the one grocer reinforces our point.

In using the term "assisted checkout," CGA president Fong is using the term Tesco's Fresh & Easy uses, because although checkout in its stores is self-service, a store clerk will assist customers with the process if it's requested.

Tesco's Fresh & Easy is a member of the grocer's association, which is headquartered in Sacramento.

Assemblyman De La Torre, the bill's author, has yet to publicly comment or issue a statement on the passage of AB 1060 in the State Senate.

Tesco's Fresh & Easy hasn't publicly commented on the legislation's passage in the State Senate yet either.

Meanwhile, Ronald Fong of the California Grocer's Association is one of the few voices so far urging Governor Schwarzenegger to veto the self-service checkout alcoholic beverage sales ban legislation.

"Current law places a grocer’s alcoholic sales license in jeopardy if inappropriate sales are identified through either the assisted [self-service] or traditional [full-service] checkout options," Fong says in asking the Governor to veto AB 1060. "Losing this license would seriously impact a retailer’s business. No retailer would put themselves in that situation," he added.

Further, Fong says: "Assisted [self-service] checkouts contain appropriate safety protocol including the system locking when any age-restricted product is scanned, requiring a clerk to verify age and sobriety, and when even slight variations in weight of product scanned and product bagged are detected. Grocers also utilize additional means to prevent theft or inappropriate access including security cameras, customer interaction throughout the shopping experience, staff training, strict inventory control protocols and the placement of both products and checkout stations themselves. California grocers take seriously their responsibility to ensure that only those individuals legally entitled to purchase alcohol do so in grocery stores. CGA fully supports efforts of the state’s regulatory agency to enforce existing laws regarding sales of alcohol. We encourage Governor Schwarzenegger to veto this unnecessary legislation," Fong concludes.

Our August 15, 2010 story [Bill to Ban Alcoholic Beverage Sales at Self-Service Checkouts Would End 'Self-Service Only' at California Fresh & Easy Neighborhood Market Stores] detailed two recent studies that supporters of AB 1060 used to help gain passage of the bill in the State Senate. Both of those studies question the argument that self-service checkout offers ample protection (Fong of the CGA's argument in his statement) in terms of preventing minors from being able to purchase alcoholic beverage items using the self-serve systems.

Apparently a majority of the California State Senate agreed with those and other arguments put forth by the legislation's supporters.

Now, however, it's all up to the Governor, who although a Republican is known for taking non-traditionally Republican positions, like his support for AB 1998, the single-use plastic carrier bag ban legislation currently in the Senate, which is also supported by the grocers' association.

For Tesco's Fresh & Easy Neighborhood Market, the Governor's decision is crucial. If the bill becomes law, it will mean at a minimum Fresh & Easy will have to have one full-service checkout lane in each of its stores - which we have said for nearly three years it should have anyway from a smart retail operations standpoint. The grocery chain doesn't want to do this because it thinks full self, or assisted, checkout is key to its success and ability to reduce labor costs extensively. Having self-service-only also is a key provision in avoiding unionization for Fresh & Easy.

Who would have though when Tesco first came to America in 2006 and decided to offer self-service checkout-only in its California, Nevada and Arizona Fresh & Easy Neighborhood Market stores - which is something it does in just one store, a Tesco Express unit, in its United Kingdom home base - the decision as to whether or not the grocer keeps that self-service-only system in its Fresh & Easy stores would end up being decided by a former world champion bodybuilder from Austria, turned Hollywood mega-movie star, turned Governor of California, named Arnold Schwarzenegger?

Related stories:

August 15, 2010: 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 piece: Breaking News & Analysis: CA Assemblyman Introduces 'Tesco Fresh & Easy Law' to Ban Stores With Self-Checkout-Only From Selling Alcoholic Beverages

Hybrid 'Good Eats' Market-Cafe From Raley's CEO Michael Teel & Company Opens Today in Sacramento CA

Northern California Market Special Report

More than two years after we first reported on it, Sacramento, California-based Good Eats - formerly Good Eats Grocer - is today opening its first combination fresh-prepared foods, specialty grocery market and cafe at 3145 Folsom Boulevard in East Sacramento.

[Read our July 8, 2008 story: Upcoming New Markets Report-Sacramento: Former Raley's CEO Michael Teel and Partners Preparing Launch of New 'Good Eats Grocer' Small-Format Chain.]

Good Eats is a venture founded in 2008 by Michael Teel, the son of the owner of West Sacramento-based Raley's Supermarkets, Joyce Raley-Teel, and the grandson of its founder, the late Tom Raley, and his partner, Michael Ashker.

Teel, who was the CEO of Raley's from 1996 -to- 2002, left the supermarket chain to start up a Sacramento-based magazine publishing and media company, Prosper Media, with Ashker. Later the two started M2 Venture Partners, a venture capital firm where they operated jointly as managing partners. M2 stood for the fact both partners' first names are Michael. Good Eats is one of the companies the firm funded and started. The details are in our July 8 story linked at the top of this piece.

The two are no longer involved together in M2 Venture Partners. Ashker, a veteran investment banker, venture capitalist and entrepreneur, is now president & CEO of Blackfish Financial, chairman of Brushfire Media Group and principal/managing partner at Agility Partners. All are his ventures.

Good Eats has been spun out of the investment firm as a standalone company majority-owned by Michael Teel and his fiancée Julie Rollofson.

Teel was the CEO of Good Eats until January of this year, when he returned to Raley's as CEO following the resignation of Bill Coyne. Julie Rollofson became CEO at that time.

Raley's has been struggling in the competitive Northern California food and grocery retailing market, even though it has the top market share in the Metropolitan Sacramento market and is number three, after Safeway Stores and Save Mart's Lucky chain, in the San Francisco Bay Area.

Teel took over once again as CEO after being gone for eight years, as part of a strategy by the family to "right the (struggling) ship," as he put it after being named head of the family-owned supermarket chain, which has about 159 stores, and does about $3.5 billion in annual sales.

Rollofson helmed today's opening of the East Sacramento store since taking over as CEO Of Good Eats. She's planning a big grand opening in September.

The flagship Good Eats market was supposed to open in December 2009-January 2010 but was postponed in part because Michael Teel became CEO of Raley's in January 2010.

Joyce Raley-Teel, along with her husband Jim Teel, are the co-chairman of Raley's board of directors. Ms. Raley-Teel worked in various executive capacities at Raley's for decades before retiring a few years ago. Her husband, Jim Teel, also spent decades as a Raley's executive. He served as the chain's head of human resources for many years, then spent more years in the top senior executive ranks.

Investment banker, venture capitalist and media man Ashker has founded a number of companies in the Sacramento region, including Imerica Life & Health Company, Healthaxis and Courtlink.

As a venture capitalist he's also been involved in funding numerous companies. For example, he has served as a financial advisor for fast-growing Colorado-based grocery chain Sunflower Farmers Market. In 2007 Ashker structured a $30 million new package for the grocery chain through one of his investment funds.

The East Sacramento flagship Good Eats market is located in what was formerly the Andiamo restaurant, a popular spot for decades in the capital city. Good Eats gutted the building and has done extensive remodeling to turn it into the hybrid small-format fresh-prepared foods store/specialty grocery market/cafe.

The market offers: in-store-made hot and cold fresh-prepared foods of all types for takeout (there's also an eat-in area); fresh meats (and seafood), merchandised in full-service counters; fresh produce and flowers; a bakery; a deli featuring cheeses, lunch meats and related items; a wine shop and wine bar; an espresso bar/cafe; and a selection of shelf-stable specialty, natural and organic grocery items.

The Sacramento Good Eats market opening today actually isn't the company's first store. In early 2009 it opened its first fresh food/specialty grocery/cafe in Scottsdale, Arizona, naming it The Kitchen at Good Eats Grocer, in order to put an emphasis on the prepared foods emphasis of the format. The Sacramento store, like the company's name, is just Good Eats. "The Kitchen" has been dropped, as has"Grocer."

In March of this year Good Eats closed the Arizona unit, which was located in The Shops at Gainey Village center in Scottsdale, after just over a year in operation. Good Eats offered no specific reason for the closing.

In an August 18, 2008 piece - Small-Format Food Retailer 'Good Eats Grocer' Signs Leases For Two More Store Sites; Five More Stores in the Pipeline For the Sacramento Metro Market - we noted that Good Eats had signed leases for two additional locations in the Sacramento region. We also quoted Michael Teel, who said Good Eats had plans for an additional five units in the region. One of the two stores with signed leases was later given up. It's the site of the decades popular Corti Brothers supermarket in Sacramento. The Corti family was in a dispute at the time with the landlord of the building over renewing the lease. The grocer and its landlord came to terms on a new lease. Corti Brothers remains open - and popular. The details are in the August 18 piece.

It's unclear at present if and when Good Eats plans to go forward with opening the additional markets in the Sacramento region. However, since taking over early this year, Julie Rollofson appears to be working towards that goal. As such, we wouldn't be surprised if an announcement of a second unit or more comes before the end of this year.

We also won't be surprised if some synergies between Raley's and Good Eats appear in the not too distant future.

It's not going to be easy for Good Eats to succeed though. But it has a chance if it executes well, focuses on customer service and doesn't offer too high of price points for the fresh-prepared foods and other food and grocery items it's offering.

On August 19, Tesco's Fresh & Easy Neighborhood Market announced the first eight stores it will open in Northern California in 2011. None of the first eight stores are in the Sacramento region. The nearest unit is in Vacaville, which is about 45 miles from Sacramento. Fresh & Easy is shooting for a February 2011 opening for the first batch of stores. [See - August 21, 2010: April 2010 Prediction Correct: February 2011 Target to Open First Eight Fresh & Easy Neighborhood Market Stores in Northern California and August 19, 2010 - Tesco Will Open its First Eight Fresh & Easy Neighborhood Market Stores in Northern California in 'Early 2011.']

There are 18 Fresh & Easy locations in the Sacramento Metro region (one in Sacramento/Vacaville, for a total of 19 confirmed) that Tesco has confirmed to date, and a couple we've discovered in our reporting. See our Northern California Fresh & Easy Store List. Therefore, we expect some of the Sacramento area stores to be opened later in 2011.

Fresh & Easy Neighborhood Market is also in the process of obtaining additional future store locations in the Sacramento region and throughout Northern California.

Fresh-prepared foods are a central focus of the Fresh & Easy format and stores. As such, when the stores start opening in the Sacramento region, the market will get an added dose of competition in the growing ready-to-eat and ready-to-heat fresh foods retailing segment. Stay tuned.

Below are the stories thus far in our '2010 Northern California Market Special Report' series:

August 22, 2010: The Insider: Challenges & Opportunities: Tesco's Fresh & Easy Neighborhood Market Will Supply its Northern CA Stores From its Riverside County DC in Southern CA

August 21, 2010: April 2010 Prediction Correct: February 2011 Target to Open First Eight Fresh & Easy Neighborhood Market Stores in Northern California

August 19, 2010: Tesco Will Open its First Eight Fresh & Easy Neighborhood Market Stores in Northern California in 'Early 2011.'

August 17, 2010: Henry's Farmers Market 'Beats' Fresh & Easy Neighborhood Market to Northern California Despite Multi-Year Head Start; Elk Grove Store Opens Tomorrow

July 29, 2010: Tesco's Fresh & Easy Neighborhood Market Putting Together List of Managers Interested in Transferring to Northern California

July 25, 2010: Safeway to Start Construction on New Pleasanton, California Flagship Store Soon; Thanksgiving 2011 Target Opening

July 22, 2010: 'The Insider' - After Four Years in the High Weeds in Northern & Central California, Kroger Co. is Emerging to Grow its Foods Co Chain

July 21, 2010: Vacant Fresh & Easy Neighborhood Market Store in Pacifica, California Has the City's Mayor in a Pickle

July 18, 2010: 'The Insider' - When it Comes to Northern California - its Competitors are Rome Burning and Tesco's Fresh & Easy Neighborhood Market is Nero Playing the Fiddle

July 14, 2010: Tony Bennett Has Nothing on Whole Foods Market When it Comes to Loving San Francisco...That City By the Bay

July 6, 2010: Walmart Looking for Store Sites in Northern California For 20,000 Sq-Ft Neighborhood Market by Walmart Prototype Store

June 28, 2010: Smart & Final to Open its New Format SmartCo Foods Stores in California and Arizona

June 26, 2010: Tesco Planning to Announce in July When First Northern California Fresh & Easy Neighborhood Market Stores to Open

June 14, 2010: Newly-Named Whole Foods Market CO-CEO Walter Robb Comes Full Circle With the Opening of the New Store in Mill Valley CA

June 5, 2010: Sprouts Farmers Market Opens First Northern California Store in Sunnyvale; Strikes Up Partnership With Local Non-Profit Farm

May 29, 2010: Going Rural: Fresh & Easy Neighborhood Market to Build First Store in Los Banos, California

May 28, 2010: First Phase of Fresh & Easy Neighborhood Market-Anchored Condo Development in San Francisco's Bayview Set For Completion in June

April 19, 2010: Tesco Debating Whether to Launch Fresh & Easy Into Northern California This Fiscal Year... or Wait

May 9, 2010: A Whopping 15 of Whole Foods Market's 41 New Stores in Development are in California - And Nine of The 15 Are In Northern CA

May 8, 2010: Sprouts, and Likely Henry's to Beat Fresh & Easy to Northern California Despite it's Big Head Start

May 6, 2010: Going Smaller & Getting 'Hybrid': Walmart's Smaller Supercenter in Vacant Retail Buildings Strategy Began in 2008

April 19, 2010: Tesco Debating Whether to Launch Fresh & Easy Into Northern California This Fiscal Year... or Wait

California's Battle to Ban the Plastic Bag Heats Up in Sacramento: Author of Legislation Says the Reports of its Death Are Greatly Exaggerated

Bagging Single-Use Plastic Bags in the 'Nation State' of California: News/Analysis/Commentary

AB 1998, the California legislative bill that would ban single-use plastic carrier bags in the Golden State's grocery stores, retail stores over 10,000 square-feet with pharmacies and convenience stores (in 2013), is alive and well in the California State Senate Rules Committee - and opponents of the bill led by the American Chemistry Council shouldn't pop their champagne corks in celebration just yet, says Assemblywoman Julia Brownley, D-Santa Monica, the author of the legislation.

Read our August 20, 2010 story: Single-Use Plastic Carrier Bag Ban Bill AB 1998 Could Be in Difficulty of Passing in the California State Senate.

Making the rounds in her Southern California district over the weekend, which included a stop on Saturday at a University of California, Los Angeles film festival where "Plastic Bag," a short film by director Ramin Bahrani was shown, Assemblywoman Brownley said that although the Senate Appropriations Committee didn't vote out the bill by its required August 13 deadline, and as a result sent the legislation over to the Senate Rules Committee, it did so for a specific reason. California legislative rules require that if the Appropriations Committee fails to pass a bill by its deadline, August 13 in the case of AB 1999, such bills can't be amended over the following 10 days, which is when the legislative session ends for the year, on August 31.

However, by giving control of the bill to the Senate Rules Committee, which is exempt from the no amendments rule, AB 1998 is not subject to the restriction and can be debated and amended between now and August 31. As such, AB 1998 has sort of a protected status, according to Brownley.

This is important because Brownley and other supports of the single-use plastic carrier bag ban legislation believe that with some minor amendments the bill can pass in the full State Senate. It must be voted on before the end of business on August 31, when the legislative session ends, however.

In other words, the bill's author says it's still alive, despite arguments to the contrary by those against the bag ban legislation.

Brownley says she had numerous meetings last week with Senate leaders to discuss amendments to AB 1998 that deal with the issues opponents are most concerned with, such as whether grocers will be able to keep the money they charge for paper bags, or whether any amount they charge above their costs will be directed to state recycling programs rather than being kept by the retailers as profits.

AB 1998 allows grocers to sell paper grocery bags to customers for a minimum of five cents each. Large paper carrier bags generally cost grocers slightly more than five cents each.

The American Chemistry Council, which among other activities is a trade group for single-use plastic carrier bag manufacturers, and a coalition of opponents of the bag ban bill, which are going by the name Stop the Bag Police, argue that "the fees collected from paper bags would be pocketed by grocers and would not fund the infrastructure required by the bill. The passage of AB 1998 would result in the elimination of hundreds of California-based plastic bag manufacturing jobs and would dismantle a young but growing plastic bag recycling infrastructure," the coalition said in a statement recently.

For those who have a fundamental understanding of California grocery retailing, the notion that grocers are going to use sales of the paper grocery bags as a profit center is hard to fathom. Most likely, grocers will sell the bags for cost or a few cents over their cost. We predict it will be no more than 10 -to- fifteen cents a bag. Many grocers might even start out selling the bags for the five cents each, the minimum charge required in AB 1998.

Additionally, we suspect nearly all grocery chains and independents will sell the paper bags for the same price, or close to it, once it's established in the market. Safeway, Kroger and Walmart will essentially set the price as the biggest retailers and market share leaders in California.

We also suspect paper bag manufactures will raise the cost of the bags to California grocers if the legislation is passed because they will see a guaranteed market in California. Grocers will likely pass any cost increases on to shoppers. However, the last thing California grocers want to do is be accused of profiting from the sale of paper bags. The public relations damage from it would far exceed any minimal profit they might make.

The purpose of the minimum five cent charge for the paper bags is to encourage shoppers to use reusable bags. In fact, many supporters argue that five cents isn't enough. Rather, they say that a fifteen cent or more per-bag charge is probably required in order to economically motivate shoppers to bring their own bags to the store.

California grocers are already required by law to sell reusable grocery bags in their stores. AB 1998 maintains that requirement.

Grocers will still be allowed to use the types of plastic bags they currently use in-store for meat, produce, bulk foods and other items under a food safety provision in the bill.

So here's the scoop, according to Brownley: This week the Senate Rules Committee should propose some minor amendments to AB 1998 dealing with the key issues noted above. She hopes those changes will gain the support of those holdouts in the Senate. Those amendments can be changed and fine tuned until August 31, when the bill must be voted on. If supporters don't think they have enough votes, they can pull the bill from a full Senate vote and bring it back next year, although if they do that it will have to go before all of the State Assembly and Senate committees all over again. AB 1998 passed the full California State Assembly in June.

Meanwhile, both supporters and opponents are lobbying Senators hard and fast. Both groups are also using free and paid media and social networking sites to get their respective messages out to California voters, who they then hope will call and e-mail their State Senators telling the legislators how they want them to vote on the single-use plastic bag ban bill.

Last week the American Chemistry Council went big in lobbying the State Senate against AB 1998. The group also launched a video of its own, titled "Trouble."

The video is in part a response to a short film, "The Majestic Bag," narrated by actor Jeremy Irons, and put out by Heal the Bay, a Santa Monica, California-based environmental group which is one of the major supporters of AB 1998, as we reported in this piece last week - August 16, 2010 Supporters of California's First-in-the-Nation Single-Use Plastic Bag Ban Going Humorous to Win on the Eve of State Senate Vote.

The California Grocers Association (CGA) supports AB 1998, as we've previously reported. The CGA, which was founded in 1898, is a non-profit, statewide trade association representing approximately 500 retail members operating over 6,000 food and grocery stores in California and Nevada, and approximately 300 grocery supplier companies. Retail membership includes chain and independent supermarkets, convenience stores and mass merchandisers. Tesco's Fresh & Easy Neighborhood Market is a CGA member, as is Safeway Stores, Inc. and most of the state's major chains and independents.

If passed, AB 1998 would prevent California cities and counties, accept San Francisco which already bans single-use plastic carrier bags, from enacting local laws regarding the plastic shopping bags. This provision is the main reason the CGA and its member-grocers is supporting the legislation. It wants a single-statewide law on plastic carrier bag use rather than the patchwork of local laws that currently exists.

It's estimated that about 19 million single-use plastic carrier bags are distributed in California retail stores each year. Just 5% of those bags are recycled, according to the state. If AB 1998 passes in the Senate, the Governor says he will sign it. If that happens, California will be the first state in the nation to ban single-use plastic carrier bags at grocery and related retail stores.

Numerous environmental groups and coalitions also support AB 1998. These include Heal the Bay, the Plastic Pollution Coalition, Californians Against Waste, Surf Santa Monica, and numerous others.

The California Legislature is going on being 60 days late without having passed a state budget. But starting today, along with more budget talks, the battle of the plastic bag will be front and center at the State Capital in Sacramento. Will the plastic bag ban pass? Or will its opponents succeed in bagging the bag ban? Stay tuned.

Related Stories:

August 20, 2010: Single-Use Plastic Carrier Bag Ban Bill AB 1998 Could Be in Difficulty of Passing in the California State Senate

August 16, 2010: Supporters of California's First-in-the-Nation Single-Use Plastic Bag Ban Going Humorous to Win on the Eve of State Senate Vote

July 20, 2010: California's First-in-the-Nation Plastic Carrier Bag Ban Legislation Looks to Be On its Way to Victory.

June 19, 2010: 'Paper or Plastic' Likely to Be Replaced By 'Reusable or Paper' (For a Fee) in California Grocery Stores

[Readers: Fresh & Easy Buzz has been reporting on, writing about, and offering analysis and opinion on the single-use plastic carrier bag, reusable bag, and related topics and issues since early 2008. Click here, here, here and here to read a selection of those posts.]