Published on: September 26, 2007The East Bay Business Times reports that UK-based Tesco has added some 48 locations – in Riverside and San Bernadino counties - to its plans for a Southern California rollout, in addition to the 50 previously announced units in Southern California, Las Vegas and Phoenix/Scottsdale.
In addition, Tesco now is saying that it plans to expand into Northern California and the San Francisco Bay Area, possibly as soon as early 2008.
The Tesco stores, called Fresh & Easy Neighborhood Markets, are scheduled to begin opening in November. While the company has played its cards close to the vest, it is known that they will be about 10,000 square feet, will emphasize healthy and nutritious foods, and will feature proprietary brands as well as fresh and packaged, prepared “convenience” driven products. To this point, Tesco seems to be interested in a range of demographic locations, choosing inner city locales as well as upscale suburban neighborhoods.
Tesco’s desire to localize its offering is seen in an interview run by Silicon.com with its group IT director, Colin Cobain, who says that “Technology is an important part of the international growth strategy. What we want to do is create a common suite of processes and systems that we can use in all of our countries. To do that what we've started off in the US - where we're due to launch later this year - we're building a suite of integrated processes and systems that will enable us to run that business. We'll have common processes and systems but the offer to the customer will be very local. It will not look like it does in Cheshunt (the company’s UK headquarters) or Korea. It will be a very specific offer for that group of customers and that's really important for us.”
Cobain also suggests that by being choosy and focused, Tesco actually is able to spend less on technology than other retailers of its size. “We try not to spend money on things which don't add value and then we can actually invest wisely in things which really improve our processes and deliver competitive edge,” he says.
- KC's View:
- You have to figure that Tesco has its folks on the ground researching possible expansion not just in Northern California, but also in places like Sacramento, Portland, Seattle, and Denver. I wouldn’t be surprised if they’re also looking at some Texas locales, though that would take real guts because of both HEB and Whole Foods. And I’d also guess that Tesco has a pretty specific game plan for how it might roll out stores in other regions of the country, like Chicago, Boston, or Washington, DC and Baltimore.
These folks are not wallflowers, and I’d expect them to move very fast if the first stores gain traction quickly.