penguinsix

Interesting piece on CNBC about why Tesco failed in the United States. Several strategic cultural mistakes (i.e. shopping habits of Americans vs. Brits, small store sizes, too much plastic) and bad timing (2008 Financial Crisis)


Got me wondering: are you still a daily grocery shopper or a weekly shopper?

Pulaski

Too many sweeping generalizations?

I think Tesco suffered from bad timing re the economy, and also launched the concept just a few years too early and/or bailed too quickly. …. I thought it was well know that Tesco's pockets just weren't deep enough to support the chain in the US until it got established, and needed capital elsewhere in the group, so they bailed out.

As I see it, nobody ever accused Walgreens, 7 Eleven, or Dollar General of having stores that were too small, so I think that argument is bunk!

Was I supposed to be a "daily shopper" in the UK? I think I shop more often here than I did in the UK, dropping in on a Kroger-owned grocery several times a week, but almost always as I am passing in that direction for other reason, or on the way home, rather than as a planned shopping trip. FWIW despite always driving to the grocery, I have retained my British habit of almost always shopping with a hand basket, which limits how much I can buy. …. I doubt I choose to shop with a trolley more than 3-5 times a year.

penguinsix

In the story they made the point a few times that the stores were designed for "UK shoppers" who preferred to shop "daily" vs. American shoppers who preferred to shop in bulk once a week or so. I didn't really know that was a difference either. Sounded more like a London vs. Suburbs kind of shopping experience.

FWIW in Hong Kong we were often daily shoppers, but that's because a) the grocery was across the street and b) our kitchen was so small it could barely hold more a few days worth of food.

Pulaski

My parents only every shopped weekly, my mother still mostly does. In London I used to buy bulk/ heavy stuff every 6-10 weeks, and supplement with a stop at Sainsbury's usually just once a week, buying only what I could carry home on the bus.

Your description of the linked report sounds like a narrow-minded market-led analysis of what was actually a complex, finance-led problem.

scrubbedexpat091

I went into Fresh & Easy a couple of times, I didn't care for it. The one local to me at the time in California was across the street from an Albertsons and an independent local grocery store so not the best location in my view.

I found I could not get everything at the Fresh & Easy and needed to go to Albertsons anyhow, so may as well just go to Albersons and skip Fresh and Easy.

They also for whatever reason wrapped a lot of produce in plastic and made you buy multiple pieces of produce at once.

I tend to shop weekly, pain in the rear end to go it daily or multiple times a week, once a week is enough.

And my store was indeed on the wrong side of the road so to speak, on the leaving city side, where Albertsons was on the coming home side.

penguinsix

CNBC emphasized the cultural differences (which I didn't quite get) even pointing out that Tesco sent 40-odd people to the US to "live with Americans" and see how they shopped. I never really thought that the UK was a "daily shopper" kind of thing but they went harped on it a couple of times so wanted to check with others if they shopped similarly.

But I would agree the financial crisis was probably much more at fault. They also emphasized that much of their development was in Western states and cities, some of which were really socked by the financial crisis. They also noted that many of the stores they bought were "on the wrong side of the road"--they bought properties that people would pass commuting into work, but which were on the wrong side of the road for the commute outbound when people are more likely to buy food for dinner.

Pulaski

But that is how most produce is sold at Kroger. Potatoes, onions, carrots, apples, mushrooms, are things we buy often and are always in plastic bags, or other containers. Spring Onions and broccoli are bundled, and lettuces and cucumbers are wrapped in plastic even though sold individually!

We could buy loose apples and potatoes, but the apples sold individually are ridiculously large, and mushrooms sold loose are more expensive per lb than the 1lb punnet.

penguinsix

In Hong Kong they sold an individually wrapped and boxed strawberry for $21.40 USD each.

https://www.scmp.com/lifestyle/food-...dually-wrapped

scrubbedexpat091

While some select items are wrapped or pre-bagged in say Albertsons or Ralphs, they are not pre-bagged/packaged on the level Fresh & Easy was.

https://www.livingafrugallife.com/wp...hs-produce.jpg

http://news.growideashere.com/images...349-pm.bmp.jpg

https://farm4.staticflickr.com/3808/...2ef92a86_b.jpg

first 2 links above is an example of a Ralphs & Albertsons store.

Fresh & Easy store that was in California, almost everything is packaged or pre-bagged.

https://secure.i.telegraph.co.uk/mul...s_2537631k.jpg

Octang Frye

We used to do a weekly shop back home at Sainsburys, supplemented by trips to the local bakery, butchers and "Spar".

I'd love to have a Tesco or Sainsburys here. I have to go to King Soopers (Kroger), Sprouts, Vitamin Cottage and Whole Paycheck to get everything.
It's a pain in the arse. And the amount of times they're out of basic things is frustrating. Only thing worse - and this is way, way worse - is shopping at Jo-Ann's Fabrics.

Pulaski

I suspect that they were also in the wrong part of town - as Jsmth noted above there were "big box" groceries nearby, when F&E stores should have been located near 7 Eleven and Walgreens, not going head-to-head with Kroger. We don't shop at Aldi for the same reason, there is a Kroger nearby and Aldi only sells some of what we want, so we'd have to go into Kroger anyway.
Our regional Kroger-owned grocery (Harris Teeter) is like a better-stocked Sainsbury's, good quality fruit and veg, deli counter, butcher's counter and fish, large choice of wines and beers. There is even an international aisle, for when I feel like spending $4 on a packet of digestive biscuits!

I was shopping in Sainsbury's at Christmas, a modern, edge of town location in Gloucester, and it was a bit sorry compared to Harris Teeter, especially at times when it had been busy because there was so little stock on the shelves.

Hotscot

Tesco is always my first stop when I go back home. Yummy processed and frozen food.
Then Sainsbury's...

Here I'm increasingly using Costco for a twice weekly visit. (Wine/salad bags/high quality protein/milk)
And then reluctantly Albertsons or similar when passing, for incidentals.

Can't wait to move back to Orange County for Bristol Farms.
https://www.bristolfarms.com/

(A few years ago a Northwest chain, Haggen, bought up several stores in SoCal to expand their market.
Variety went down, prices went up, they failed miserably and disappeared post haste. Major executive misstep.)

dc koop

Fresh n Easy didn't have anything that the others stores didn't have and it was about half the size of it's rivals and with half the choice of merchandise. It reminded me of the type of small town grocery store one visits for odds and ends while on a long road trip

Pulaski

So explain Dollar General, Walgreens, and 7 Eleven, among others, that have limited stock and high prices.

scrubbedexpat091

The Haggen expansion was interesting.
They had 18 stores and 2,000 employees.
Albertsons and Safeway were in the process of a merger and had to drop 146 stores as part of the merger approval process.
Haggen bought the stores and went from a small regional supermarket to 164 stores and 10,000 employees virtually overnight.

A bankruptcy and lawsuit against Albertsons accusing them of anti-competitive behavior, Albertsons ended up buying the last 29 stores, keeping 15 with the Haggen name in Washington.