Shoppers Can Swap 'Pink Slime'-Laced Ground Beef For 'Slime-Free' At Fresh & Easy

Fresh & Easy's fresh&easy brand ground beef (above) is free of the ammonia-treated filler "pink slime," Photo courtesy of www.ninjashopper.blogspot.com.

'Pink Slime-Free Wednesday' at Tesco's Fresh & Easy - Analysis & Commentary

When the news many U.S. food and grocery retailers sell ground beef laced with the ammonia-treated filler "pink slime" (we've known about it for many years, as have many others with experience in the industry) hit the mass media like a ton of frozen ground chuck last week, we offered grocers some immediate advice via these two tweets on the Fresh & Easy Buzz Twitter feed, on March 17:

>Tweet One, March 17, 2012: #Grocers take note: If you don't sell #hamburger containing #pinkslime, tell the world. Why? It's now a point of competitive advantage.

>Tweet two, March 17, 2012: "The Corollary: if you're a #grocer selling #hamburger containing #pinkslime, drop it. Slime and #food are antithetical in consumers' minds.

Tesco's Fresh & Easy Neighborhood Market, which does not use "pink slime" in its hamburger, is doing just what we said grocers should do in the first tweet above on March 17, which is to tell the world - in Fresh & Easy's case consumers in California, Nevada and Arizona where it has its nearly 190 grocery stores - there's no "pink slime" being used as filler in the ground beef offered for sale in its stores.

And Tesco's Fresh & Easy is "telling the world" it doesn't and has never used "pink slime" in its ground beef in a smart and creative way.

On Wednesday, March 28, Fresh & Easy Neighborhood Market is holding a "Pink Slime Swap Meat" at all its stores. Consumers can bring up two two pounds of fresh or frozen ground beef from another retailer to any Fresh & Easy store and exchange it for a package of fresh&easy (80/20) ground beef at no cost.

As part of the promotion Fresh & Easy is also asking interested customers to use the hashtag #SwapMeat on their Twitter and Facebook sites on Wednesday as part of the "pink slime" ground meat swap out. (80/20 refers to the ratio of lean meat to fat in the ground beef.

According to Tim Mason, CEO of Fresh & Easy, the Tesco owned fresh food and grocery chain "grinds all of its own meat, using only fresh, never frozen beef."

Mason is also inviting customers who have questions about the "pink slime" issue, Fresh & Easy's meats, or any other and Fresh & Easy private brand products to e-mail him at tim@freshandeasy.com, saying in a statement issued just moments ago: "It’s understandable that people would lose confidence in food retailers because of the use of pink slime. Fresh & Easy has never been about shortcuts or fillers - just high-quality fresh food that we produce ourselves, so we know it’s the best."

All the meat sold in the Fresh & Easy stores is cut and ground at the retailer's food and distribution facility in Riverside County, California, where its also packaged. The fresh meats are then shipped to the stores in California, Nevada and Arizona. Unlike most other grocery stores and supermarkets, the Fresh & Easy markets don't have meat departments in-store.

In our March 17 tweet advisory to grocers that don't use "pink slime" in their ground beef, we said touting that fact offers a competitive advantage if done in a timely manner.

The reason this is so is because the "pink slime issue has already a major food safety - not to mention a gastronomical nightmare - with consumers. Like we said on March 17 in our second tweet to grocers that do use "pink slime" in their ground beef: "The Corollary: if you're a #grocer selling #hamburger containing #pinkslime, drop it. Slime and #food are antithetical in consumers' minds." The conflicting concepts are also hard to swallow when it comes to consumers' stomachs.

Most grocers that have been using pink slime are doing just that - stopping the practice and announcing it to the consuming public.

In our analysis Fresh & Easy's "Pink Slime Swap Meat" is a home run on numerous levels.

First, it's a creative yet a simple concept, which are the best kind to communicate to consumers.

Second, and most importantly, it takes advantage of the competitive advantage opportunity not using "pink slime" in ground beef offers grocers like Fresh & Easy, in terms of offering to exchange consumers "pink slime"-laced ground beef for a "pink slime"-free substitute - fresh&easy brand - at one of the grocery chain's stores.

The key potential short-term competitive advantage with this is that it might drive shoppers who've previously never stepped foot into the Fresh & Easy stores into the small-format grocery markets. There's also a branding opportunity for the grocer with its fresh&easy brand in the fresh meat category.

Fresh & Easy's "pink slime"-laced ground beef swap out on Wednesday should draw some attention to the grocery chain in general, and more significantly to the healthier food store position and brand Tesco has been and is attempting to stamp on its Fresh & Easy Neighborhood Market operation. This offers a potential competitive advantage element in the chain's long-term efforts to convince consumers that Fresh & Easy equals healthy, safe and tasty foods.

Free, as in bring in your pink slime ground beef, and get pink slime-free hamburger in return for no charge, is a powerful message and concept, as is the fact the trade out is as easy as meat pie.

Lastly, the creative "pink-slime"-laced ground beef for "pink slime"-free swap out concept has an element of fun to it, which combined with all of the above elements adds power to the event. It's also a good news hook which we are certain the mainstream media will pick up on.

One important caveat though to such promotions: Grocers must be very careful they operate a fully integrated "clean food" operation when they go this route. Why? Because if they don't, they could be caught in a pink slime situation of their own, and having challenged competitors previously with this type of promotion therefore would put them in an extremely vulnerable place should such a thing occur.

We give Tesco's Easy Neighborhood Market high marks across the board - creativity, practical application competitive advantage opportunity, ect., for its ground beef trade out event planned for Wednesday.

Most all grocers who've been using "pink slime" in the ground beef they offer for sale are dropping it. Many have already done so. In our analysis, the rest will do so in the days ahead. After all, what food retailer in its right mind wants to be know as the grocer with the "pink slime"-laced hamburger in its stores?

Therefore, we predict any competitive advantage from the "pink slime" issue will be rather short-lived. Most food retailers are acting rapidly to no longer stock ground beef laced with the garbage. Consumers will forgive, as long as those grocers guarantee their ground beef is now "slime free."

As a result, grocers like Fresh & Easy are wise to strike while the grill is hot because a couple months from now we doubt the topic of "pink slime" will be getting much attention.

California Resident Launches Online Petition to Encourage Repeal of State's Self-Service Checkout Booze Ban Law

News/Analysis

California resident Rich Saavedra today launched an online petition designed to encourage the California State Legislature to repeal AB 183, the law passed by a majority of legislators in both houses last year and signed into law by Governor Jerry Brown, that banned the purchase of alcoholic beverages at self-service checkouts in retail stores in the Golden State.

In the petition, which is posted at thepetitionsite.com (view it here), Saavedra says self-service checkouts, such as those used exclusively at Tesco's Fresh & Easy Neighborhood Market - he doesn't mention Fresh & Easy specifically - have safeguards built-in that prevent minors from being able to purchase alcohol using the checkouts, which is the primary reason supporters of the law gave for enacting AB 183 last year.

Those safeguards in place at Fresh & Easy include the fact the self-service checkout system locks up whenever a customer scans an alcoholic beverage item.

Once the system locks up a store worker comes to the checkout, checks the shopper's identification card - the chain's policy is to do so if the customer looks to be under 40-years-old - and if the shopper is 21, the minimum legal age to buy alcohol in California, the employee then punches a special code into the machine, which allows the checkout process to continue.

Since AB 183 has become law we've observed the store clerks remaining at the checkouts, monitoring the process, or scanning the customer's alcoholic beverage items for them.

Explaining his reason for launching the online petition today, Richard Saavedra says: "Let's send a message to the lawmakers of the state of California that we will not stand for frivolous laws.  They should be concentrating on the bigger decisions that impact the residents of California, like the state budget, and making sure we have enough Police and Firefighters."

So far Saavedra's just-posted online petition has three signatures, including his. He hopes to get at least 10,000 signatures on the petition.

Although AB 183 is law in California, it isn't currently being enforced because the California Grocers Association (CGA), the trade group for food and grocery retailers doing business in California, has filed a lawsuit challenging the enforcement mechanism put forth in a December 23, 2011 advisory memo early this year by the California Alcohol Beverage Control Agency (ABC), which is charged with enforcing the law.

Tesco's Fresh & Easy Neighborhood Market is a member of the state grocers' association.

Mary Kasper, Fresh & Easy's general counsel/corporate secretary and a vice president at the chain, has played a major role in the CGA's filing of the lawsuit.

Kasper's worked with the trade group in the past. For example, prior to joining Tesco's Fresh & Easy she was general council and corporate secretary for Kroger-owned Ralphs' Grocery Company, which is the market share-leading food and grocery retailer in Southern California.

In its lawsuit the grocers' association asked the California Third District Court of Appeals, which is where CGA filed the suit, to halt the ABC's enforcement plan, which the court did, until the lawsuit is resolved.

That halt, and thus the ABC's ability to enforce the self-service checkout alcohol sales ban, which primarily affects Tesco's Fresh & Easy because its the only chain or independent in California that uses a self-serve checkout system only (which it calls assisted checkout because store clerks assist customers if asked), remains in place until the court rules on the lawsuit, which has yet to occur.

Assisted checkout at Tesco's Fresh & Easy.

All of the other grocery chains, independents and other format retailers in California using self-service checkouts and offering alcohol for sale, also offer the option of full-service checkout in their respective stores. AB 183 also applies to the self-checkouts in those stores, meaning customers purchasing alcoholic beverages can't, under the law, self-scan purchases of alcohol at the self-service checkouts.

Fresh & Easy and all other retailers are allowed to continue using the self-service checkouts to sell alcoholic beverages until there's a resolution by the court over the CGA's lawsuit challenging the ABC's enforcement scheme and plans. This is why, for example, if you shop at a Fresh & Easy store in California, you haven't seen any changes in the self-checkout system pertaining to alcohol purchases, even though AB 183 became law January 1, 2012.

Repealing a bill that's been passed into law and signed by the Governor, such as AB 183, is difficult to do in California.

What has to occur from a realistic and politically practical standpoint is that a legislator essentially has to introduce a new bill addressing the issue.

For example, the new bill could be written to once again make it legal for alcohol transactions to be conducted by retailers at self-service checkouts.

Conversely, a member of the legislature could author a new bill that simply modifies aspects of AB 183, such as making it legal to sell alcohol using self-service checkouts as long as a store clerk is present while the customer scans his or her grocery purchases (or does the scanning for the shopper), and that identification is checked prior to allowing the customers to scan the order if it includes alcoholic beverages, for example.

These and/or other provisions could be attached to such a bill, so rather than a full repeal of AB 183 the current law is instead modified, allowing retailers to use self-service checkouts to sell alcohol but placing various conditions on such use.

It's this latter approach that, in our analysis, we believe offers the most politically realistic approach for those in California who want to see the current law changed.

However, since the court is still considering the CGA's lawsuit, it's really a moot point because how AB 183 is enforced, and thus the law itself for all practical terms, is now in the California Third District Court of Appeals' hands.

If the court does rule in the CGA's favor, it's likely the law's author, Assemblywoman Fiona Ma (Democrat-San Francisco), and supporters will move to amend AB 183 so it not only remains as law but makes enforcing it - banning alcohol sales completely at self-service checkouts - by the ABC possible. It is ambiguous language in the original bill that paved the way for the lawsuit in the first place.

There currently remains a solid majority in the Democrat-controlled California State Assembly and California State Senate in support of AB 183. Legislators have been known to change their minds though, with pressure - it's called politics. And this is what Saavedra says in his online petition he hopes getting the 10,000 signatures will help to do - influence members of the legislature to take a second look at the law.

Another approach that could be taken would be to put an initiative on the ballot in California that would repeal the self-service checkout booze ban law using the Golden State's popular voter-initiative process. Such initiatives can be sponsored by trade groups like the CGA, retailers, such as Fresh & Easy, other groups, and state residents (or all combined).

The direct-to-voters initiative process is an approach regularly taken in California - Governor Brown is using it himself for a set of budget and tax proposals that will be on the November 2012 election ballot.

Such an initiative might in fact be the best way to resolve the issue because it would allow California voters, who also are consumers and shoppers at the state's grocery and other retail format stores offering alcoholic beverages for sale, to decide whether or not the adult beverages should or should not be allowed to be purchased at self-service checkouts in California stores.

Related Stories

February 5, 2011: Fresh & Easy Neighborhood Market Testing 'Scan As You Shop' Mobile Self-Checkout System at Burbank Store
January 1, 2011: Fresh & Easy Neighborhood Market Gets A Reprieve of Sorts On California Self-Service Checkout Booze Ban Law

December 29, 2011 piece for details: The 'Fresh & Easy' Writ: California Grocers Association Files Lawsuit Over Self-Service Checkout Booze Ban Law.

December 8, 2011: Bad Timing With New Law Effective January 1, 2012: Fontana, California Fresh & Easy Store Cited For Allegedly Selling Alcohol to Minors

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

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

See additional stories and analysis on AB 183 here.

Scoop Confirmed: Sprouts Announces Acquisition of Sunflower Farmers Market

The Insider - Heard On the Street

Phoenix, Arizona-based Sprouts Farmers Market and Colorado and Arizona-based Sunflower Farmers Market decided to give the tens of thousands of attendees at the natural-organic products' industry's largest annual trade show on the west coast, Expo West, which began in earnest today in Anaheim, a little something to talk about on the show floor and in the always jam-packed area bars and restaurants this weekend.

It's also something the tens of thousands of you who've been reading my reporting about the deal between Sprouts and Sunflower since November 2011 have been waiting for - and which you learned about in Fresh & Easy Buzz months in advance of today because the publications writing about it today are doing so for the first time based on the press release - which is the announcement Sunflower Farmers Market is being merged into Sprouts, which will result in one farmers' market-style chain in the U.S. - Sprouts Farmers Market.

Today Sprouts and Sunflower announced they've reached a definitive agreement to merge Sunflower Farmers Market and its 35 stores into Sprouts Farmers Market, creating a chain of 139 stores with an estimated annual revenue of $2 billion, which is about the total annual sales amount I estimated in my past columns the combined chains would generate.

Like it did with the Henry's Farmers Market deal last year, Sprouts Farmers Market, which is majority-owned by private equity firm Apollo Global Management and has about 200 mostly individual investors, is essentially acquiring Sunflower Farmers Market, although the retailer's are using the term merged. Sunflower will become part of Sprouts. It's identity and name will go away. Apollo will remain the majority and controlling owner of the combined company, Sprouts Farmers Market.

In the announcement today, Sprouts CEO Shon Boney said the deal is expected to close, pending regulatory approval, in the second quarter of this year, which is soon.

He also said the 35 Sunflower Farmers Market stores will be re-branded under the Sprouts banner by the end of 2012, following the same strategy and about five-month time frame Sprouts used in re-branding the Henry's units to the Sprouts' banner in 2011.

Two stores in Temecula, California remain under the Henry's Farmers Market banner because an existing independent natural foods' retailer in the city, Sprouts Natural Market, has filed a lawsuit in Riverside County Superior Court seeking to prohibit Sprouts Farmers Market from changing the names of the two Henry's stores. Until a ruling is made by the court, Sprouts Farmers Market can't re-brand the two units in Temecula from Henry's to Sprouts.

Sunflower's headquarters operations in Colorado (Boulder and Denver) and Arizona (Phoenix) will also be folded into Sprouts corporate headquarters in Phoenix, as was the case with Henry's headquarters in Irvine, California. Like in the Henry's case, Sunflower's offices will remain open for a while but be closed before the year is out.

The combined chain also plans to open up to 13 new stores this year, as I've previously reported. Those stores will all be under the Sprouts Farmers Market banner, Boney said today.

Sunflower also extends Sprouts Farmers Market Farmers into Nevada, Utah, New Mexico and Oklahoma, states where Sunflower has stores but Sprouts' doesn't, along with adding units in California, Arizona, Colorado, where Sprouts currently operates its 104 stores.

Here's what Andrew S. Jhawar, a senior partner at Apollo and the co-head of its Consumer and Retail Industry Group, said about the deal in the announcement release today: "We feel incredibly fortunate to be able to bring together the management and operations of these two growth-oriented grocery retailers who focus on natural and organic products. In doing so, Sprouts will become an even better company offering more value to the nearly 1.5 million customers who regularly shop at the combined company's stores," he said.

"This is a combination that makes great sense given the rapid growth in demand for natural and organic products and the complementary nature of the geography of the two companies. Apollo is excited to support Sprouts' dynamic management team and to help the company prepare for continued growth throughout the United States," the Apollo Global Management senior partner added.

Jhawer played a key role in doing the deal, which is part of Apollo's plans to dramatically grow Sprouts Farmers Market, which is began doing in earnest last year when it merged Henry's, which it owned through its Smart & Final grocery retailing company based in Southern California, into Sprouts, gaining majority ownership in Sprouts Farmers Market as part of the deal.

Stan and Shon Boney, who remain investors in Sprouts and are two of its founders, will continue to be Sprouts Farmers Market's two senior-level executives. Stan Boney is chairman. Shon Boney, Stan's son, is CEO.

Doug Sanders is responsible for the day-to-day operations of Sprouts as its president. He remains in that position. Chris Sherrell, president and CEO of Sunflower Farmers Market, is expected to join Sprouts Farmers Market in a senior capacity.

When I first reported on the negotiations between Sprouts and Sunflower on November 6, 2011, I said the the Sprouts'-Henry's deal was roll up number one in terms of what were the then three competing farmers market-style grocery chains in the western U.S. The deal to merge Sunflower Farmers Market, which became Sprouts' only remaining identical-format competitor after the Henry's deal a year ago, into Sprouts Farmers Market is roll up number two, as I called it in my November 6, 2011 column here.

Sprouts Farmers Market has created a special website to announce the deal with Sunflower, which is identical to the site it set up to announce the Henry's Farmers Market deal.

That website is here. You can read the general announcement about the deal here. The press release statement distributed to the media today is here.

And, in case you're wondering, two of the founders of Sunflower Farmers Market, Libby Cook and Randy Clappnot, who are known only to those of us who work in the industry or who follow it very closely, were mentioned in the deal announcement today.

But that other co-founder, Michael Gilliland, the man who was the CEO and the public and media face of Sunflower Farmers Market from its founding in 2002 until early February 2011, when he resigned after being arrested February 10, 2011 and charged with one count of felony child prostitution as the result of a sting operation conducted by the Phoenix police department, was omitted, which is an omission one can hardly blame - or be surprised about - the board members and CEO's of Sprouts' and Sunflower from making.

Gilliland and Forman have filed motions for and received a series of continuances in his trial over the last year. In fact, the two appeared in the Maricopa County, Arizona Superior Court yesterday for a pre-trial conference, where he was granted a continuance. He was set to go to trial March 15. But it appears the trial has been postponed to April 12, as you can see here.

But considering from 2002, when Sunflower was founded, up until February 9, 2011, the day before his arrest, Michael Gilliland was that public face of Sunflower Farmers Market, it's a bit surreal, at least to those of us who work in the industry or who follow it very closely, to see no mention of him, for obvious reasons, in an announcement of this sort.

Perhaps there's an object lesson in it for the food retailing industry, which is: Avoid using an individual as the public face of your grocery chain or even of a major marketing campaign because the potential downside of doing so can be severely damaging, although in Sunflower Farmers Market's case its board and CEO Chris Sherrell have managed the situation well. Instead, let your stores be the face of the chain to the public.

I'll have more to say about the Sprouts-Sunflower deal in an upcoming column. But for now I'm going to bask in Fresh & Easy Buzz's scoop. Actually that's not true. Instead, I'm going to check in with a bunch of people at Expo West, so I can find out how the announcement is playing in those bars and restaurants tonight.

And although the focus at the mega-show is on healthy, natural and organic food and drink, those bars are always as packed as the show floor is. They're also the best place to pick up what might eventually become the makings of a good scoop. At least that's what I'm told.

- 'The Insider'

Suggested Reading - Sprouts and Sunflower: The Art of the deal coverage

~The first report (ever) - November 6, 2011: Roll Up Times Two? Sprouts Farmers Market In Talks With Sunflower Farmers Market About Possible Acquisition

~The follow up: A deal is done - February 7, 2012: Deal Announcement From Grocers Sprouts and Sunflower Farmers Market on Tap

~Most Recent: Bringing the elements of the deal together - February 13, 2012: Sunflower Farmers Market, Sprouts and Private Equity: The Art of a Soon to Be Announced Deal

Additionally

~Scoop de jour: Read past columns by 'The Insider', including those where he broke the news about the Sprouts-Henry's deal, here.

~Sunflower makes three: Also see these links - Apollo Management, Sprouts Farmers Market, Sunflower Farmers Market and Henry's Farmers Market - for more reporting, analysis and commentary in Fresh & Easy Buzz on the three farmers market-style chains that are now one.

A Girl, Her Fork and Fresh & Easy Neighborhood Market's Sacramento Opening

The Fresh & Easy store at Watt and El Camino (above) in Sacramento opened at 10 a.m. this morning. [Photo credit: Fresh & Easy Buzz.]

Guest Blogger: First Person Singular

Tesco's Fresh & Easy Neighborhood Market opened its first two stores in the Sacramento metropolitan market region today.

Both stores, as we noted in this piece - March 5, 2012: First Look at One of the Two Fresh & Easy Stores Opening In Sacramento Wednesday - yesterday, are in the Capital City, at Watt Avenue & El Camino Avenue and Mack Road and Franklin Boulevard.

Next Wednesday, March 14, Fresh & Easy opens three more stores in the Sacramento region. The locations of the those stores are - Folsom (East Natoma Street and Blue Ravine Road), Elk Grove (Elk Grove Florin Road and Calvine Road) and Lincoln (Lincoln and Sterling Road.)

As we also noted in the March 5 story, we'll have a competitive analysis piece in Fresh & Easy Buzz later this week, focusing on Fresh & Easy in the Sacramento market and the market's key food and grocery retailing players.

But today we received an e-mail note from a Sacramento resident, Ally. She told us she's a regular reader of Fresh & Easy Buzz and a food blogger.

Further, in the note she included a link to a story she published in her blog, "A Girl and Her Fork," today, after visiting the just-opened store at Watt and El Camino in Sacramento.

The Sacramento food blogger also attended a fairly lavish event Fresh & Easy Neighborhood Market held, targeting food bloggers like her living in the area, on the eve of the opening of the first two Fresh & Easy markets in Sacramento, which she also writes about in her piece today.

We enjoyed reading her story. It comes off as objective, honest and fair, despite the fact she ate and drank for free on Tesco's dime at the fairly lavish event noted above.

Additionally, because the food blogger lives in Sacramento and devotes much of her time to the local food scene, and blogs about it, we thought it would be interesting to bring a guest perspective - and a local Sacramento one paticularly - to our readers today.

Here's her story, which also includes photos: March 7, 2012: Fresh & Easy Market Hits Sac Town

First Look at One of the Two Fresh & Easy Stores Opening In Sacramento Wednesday

Sacramento Bound

Pictured above is the Fresh & Easy grocery market at Watt Avenue & El Camino Avenue in Sacramento, which opens March 7. The photos were taken last week - the one at top during the day, the one above at night - as workers prepared the store for Wednesday's opening. [Photo credit: Fresh & Easy Buzz.]

Wednesday morning Tesco's Fresh & Easy Neighborhood Market will make its long-awaited - and long-postponed - launch in metropolitan Sacramento, California, opening two stores, at Watt Avenue & El Camino Avenue and Mack Road and Franklin Boulevard, in Sacramento.

The following Wednesday, March 14, Fresh & Easy will open three stores in three Sacramento-area cities - Folsom (East Natoma Street and Blue Ravine Road), Elk Grove (Elk Grove Florin Road and Calvine Road) and Lincoln (Lincoln and Sterling Road.)

In November 2011 Fresh & Easy Neighborhood Market said it would open a sixth store in the region, at 34th Street and Broadway in Sacramento's Oak Park neighborhood, before the end of March. Fresh & Easy hasn't announced an opening date for that store yet.

Fresh & Easy's Sacramento market region launch is long-awaited, as well as long-postponed, because it was in February 2008 when the fresh food and grocery chain announced its plans to enter the market, listing 19 store locations it said it would start out with.

United Kingdom-based Tesco originally planned to start opening Fresh & Easy stores in metro Sacramento as early as mid-to-late 2009, as part of a planned launch into Northern California. However it postponed the Northern California launch because of Fresh & Easy's poor performance.

Tesco and Fresh & Easy Neighborhood Market also decided not to launch into Northern California in 2010, again because of the chain's poor performance and numerous problems.

Finally, in March 2011, Fresh & Easy launched into Northern California. To date there are 19 stores in Northern California - 16 in the San Francisco Bay Area and one each in Fairfield, which is on the outer border of the Bay Area; Vacaville, which is about midway between Sacramento and the Bay Area; and Modesto, which is about an hour's drive from both Sacramento and the East Bay Area.

The opening of the first two stores in Sacramento on Wednesday, including the unit at Watt Avenue and El Camino Avenue pictured at top, comes a year and five days after Fresh & Easy opened the first two stores in Northern, in San Jose and Danville, as we reported here on March 2, 2011: Fresh & Easy Neighborhood Market Opens First Two Stores in Northern California Today.

Coming this week

We'll have a piece in the blog later this week offering analysis on Tesco's move into the metro Sacramento market, along with a competitive analysis of the key food and grocery retailing players in the region.

Suggested reading below: A primer on Tesco's Fresh & Easy in the Sacramento metropolitan market region

February 9, 2012: Confirmed: First 2 Fresh & Easy Stores Open in Sacramento March 7; 3 in Metro-Area March 14

January 18, 2012: Fast-Growing The Fresh Market Chain On Track to Launch in California This Year

August 3, 2011: Fast-Growing Specialty Grocer The Fresh Market Targeting Mid-2012 For First California Store

August 31, 2011: Tesco Says Sayonara to Japan, Good Morning to Sacramento

August 29, 2011: Meaningful Move or Too Little Too Late? Fresh & Easy Neighborhood Market Planning Early 2012 Metro Sacramento Market Launch

January 12, 2011: First Northern California Fresh & Easy Neighborhood Market Stores Opening March 2; Nine More to Follow March-April

January 10, 2011: Sprouts Farmers Market to Open Second Northern California Store in Roseville No Later Than Mid-April

December 5, 2011: Dollar General Jump-Starts California Launch: Taking Over 5 Centro Mart Supermarkets For Early 2012 Openings

November 22, 2010: Tesco's Fresh & Easy Neighborhood Market Plans Five New Stores in Northern California's Sacramento Region

September 26, 2010: While Tesco's Fresh & Easy Neighborhood Market Postponed, Target Opened 42 'P-Fresh' Fresh Food and Grocery Markets in Northern California

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 [Henry's is now part of Sprouts Farmers Market. The Elk Grove store has been rebranded as Sprouts Farmers Market. Details here]

July 6, 2010: Walmart Looking for Store Sites in Northern California For 20,000 Sq-Ft Neighborhood Market by Walmart Prototype Store [Walmart is going to start opening Neighborhood Market stores in Northern California this year. More here.]

October 8, 2008: Putting the 'Neighborhood' in Neighborhood Market: 'Localism' and Tesco's Proposed Fresh & Easy Neighborhood Market in Sacramento's Oak Park

February 28, 2008: News & Analysis: Tesco's Fresh & Easy Confirms 19 Store Locations for the Sacramento-Vacaville Region in Northern California

See these links - Fresh and Easy Northern California, Northern California Special Report, Fresh and Easy Sacramento, Fresh and Easy Sacramento Metropolitan Region, Vacaville-Sacramento region - for additional background reading.

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

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

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

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

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

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

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

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

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

Green light for Fresh & Easy Express

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

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

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

Los Angeles County: Fresh & Easy Express' ground zero

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

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

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

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

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

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

Related Stories

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

Reader Resources

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