Why Fresh & Easy failed

The grocery chain is likely to close its doors. British giant Tesco just couldn't make a profit here and sent confusing messages to US shoppers.

By Kim Peterson Dec 6, 2012 9:19AM
Credit: Danny Moloshok/Reuters
Caption: Fresh & Easy Neighborhood Market food store in Compton, CaliforniaFresh & Easy was one of those grocery stores you wanted to love, but kept forgetting about. And now, the chain may be closing its doors.

British grocery giant Tesco (TSCDY) will probably close its Fresh & Easy Neighborhood Market stores and head back to Europe. Fresh & Easy's CEO is leaving as well, and the entire money-losing venture will be dismissed as a failure. Fresh & Easy opened in 2007 in the U.S., but lately has begun closing stores and finding other ways to cut costs. It still has about 200 stores in this country, mainly in Nevada, Arizona and California.

Why couldn't Fresh & Easy cut it? The Guardian lists several reasons, starting with its name, which sounds a bit like some kind of sanitary product. Another reason was because Fresh & Easy didn't embrace the couponing culture of America. In Britain, coupons are seen as "a sign of desperation," the Guardian reported.

OK fine, so why is Trader Joe's surviving without coupons? The Guardian says the Fresh & Easy stores were cold and off-putting, with nothing like the warm, fun feeling Trader Joe's evoked.
Some Fresh & Easy stores closed in my neighborhood, and it was easy to see why. People don't want produce sold in shrink-wrapped packages. They weren't big fans of the herbed lamb cuts at the store, and they wanted American staples like Oreos and Doritos at reasonable prices.

Fresh & Easy tried to make a run at the Trader Joe's customer, but Trader Joe's has some of the highest customer loyalty ratings in the business, and shoppers weren't going to make the switch without a good reason. Fresh & Easy just couldn't give them the right reasons.

The U.S. grocery market is super competitive, and without a solid strategy (and a better name) there was just no way Fresh & Easy was going to survive.

"It just became clear to us that the journey to sustainable returns was going to take too long," Tesco's chief executive, Phil Clarke, told reporters, according to Reuters. "It's likely but not certain that our presence in America will come to an end."

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76Comments
Dec 7, 2012 1:32PM
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I am pretty sad that they are closing. I would often pick up the chicke and orzo with mango salsa for my lunch. :) Healthy (Fresh) and easy. Like the name. I am going to miss it a lot.
Dec 7, 2012 1:31PM
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I love Fresh and Easy!  I hope it doesn't close!
Dec 7, 2012 12:29PM
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I just did not think it was anything special , Stater Bros & Trader Joe's, Local Farm stands in the Redlands area work for me! To bad for lost jobs
Dec 7, 2012 11:32AM
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Most their prepared foods were expiring same day,  We don't food shop daily. we shop weekly
Dec 7, 2012 10:19AM
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I guess there are just to many people like myself that are already set in their ways and will only shop at the places they have always shopped at. For me and many in Vegas it was Albertsons/Smiths and Costco. I could have seen trying something different if there were only a limited amount of shopping choices, but in most of the places that they would build a Fresh and Easy there were already a number of other chioces.Over time, Just not enough money in food to support all the choices.
Dec 7, 2012 3:51AM
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I like fresh and easy, they have more fresh produce not in shrink-wrap packages and some produce in shrink-wrap package, you have a choice.  They mark down a lot of food on the expiration date, you can eat it that day or the next, even freeze it.  The mark down is 25% in the morning, 50% mid-day, and up to 75% the end of the day.  They also carry there own brands as do all grocery stores, but carry more traditional brands as other stores.
Dec 7, 2012 12:52AM
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Are you kidding!?! Fresh and Easy is my FAVORITE store! I can't imagine my life without them. I will have to go back to the awful big box grocery stores.
Dec 7, 2012 12:04AM
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Well, this consumer and her family is extremely bummed.  Since Fresh & Easy opened up less than 1/4 mile from our house they've received 75% of our grocery budget and we stopped going to our local Sprouts completely which normally got at least that missing 25%.

What do we love about it?  Small so it's easy to get in and out of quickly.  Consistently best prices in town for dairy products (we go thru 5-7  gallons of milk weekly) and the hub can ride his bicycle there if need be.  Knowledgeable and friendly staff.  Fresh baked goods, not just french bread loaves like most markets.  Good prices on the occasional Brit treats like canned Spotted Dick.  As far as produce goes, they are price competitive with the 6 (!) (Stater Brothers, Ralph's, Sprouts, Food 4 Less, Target and WalMart) other local chain stores within 2 miles of our house.  How, in an area known for it's strawberries, they can beat them in prices but taste as well is always a surprise to us.

They also offer a wide range of organic food products, both canned and fresh.  And their own line of ready-to-eat meals, salads, soups and desserts.  All of the ones we've tried (about 2/3 of what they offer) have been tasty and warrant repeat purchases.

If that weren't enough, you can also pick up green products like detergents for competitive prices.  The same with pet products, kitchenware and fresh flowers!

In case you think I'm making this up, I went there on Tuesday.  I bought 4 packages of 80/20 ground beef at $3.98 for 2 LB each.  No one has it for $1.99 a pound here and I bought enough to last the entire month!  We swear by their pasta sauces and use at least 2 jars of it a week so $1.99 for each of those is a real bargain too.  4 tomatoes at $.98 and great roll-your-own pizza dough so we had a quick and delish dinner that night.  Let's get real and name names here.  I also bought 2 12oz boxes of Special K with Red Berries Cereal at 2/$5.  My local Food 4 Less had it for the next cheapest price...$4.35 for the same size package.  4 avocados were 4/$2, in-between the highest and lowest Food 4 Less prices but better tasting and quality.  Add milk and we topped at just over $30 and used a coupon had us paying under than amount for a lot of food.

I'm not saying they always have the best prices on everything all the time.  One must be an informed customer to get the best savings and live within a budget.  If I wasn't then I would have paid the $3.49 cost of Best Foods mayonnaise at F4L instead of F&E's $2.48.  I'm just saying...if I had only one store to choose from, I would bite the bullet and pay the higher prices on some things.

AND...as budget conscious buyers, they more than any of the other shops, make us feel like they care about us.  We get weekly coupons good for X amount of dollars off Y amount of purchase (sometimes $5 off of $25 or $3 off of $30 or $10 from $50) so we made sure to unify our shopping to get those discounts.  Plus, their Friends program gives us a percentage back from the purchases we do make.

Where do they fail then, in my eyes?  Lack of advertising.  I think if they worked harder at that, they wouldn't be in the shape they must be in right now.
Dec 7, 2012 12:04AM
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Never heard of them till now. I live in Pa.
Dec 6, 2012 11:31PM
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It is amazing that those with the higher education and the loads of money could not see that the Fresh and Easy marketing model was going to be a failure..When I saw the numbers and locations of the markets being opened in Las Vegas, I asked myself why. Usually a successful buisness model fills a specific need that is not currently being filled. I could not see this need with Fresh and Easy. I am just surprised that they did not close the stores much sooner. I guess some people just love losing money.
Dec 6, 2012 10:39PM
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hey thank obama for the horrible economy and his socialist agenda! you democrat liberal dopes! wait til his socialist agenda kicks in 100%!

obamacare and taxes and big govt agenda and regulations on cheap energy you will see higher food gas fuel and energy prices!

Dec 6, 2012 10:20PM
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"...staples like Oreos and Doritos..."  
Are you sh***ing me?  I thought staples were eggs, milk, veggies, bread, and other basic foods that people buy first and often.  If you consider Doritos a staple, you're not going to live very long.
Dec 6, 2012 10:07PM
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I LOVED F& E., BUT COULD NOT GET INTO TRAVELING SOMEDITANC ETO SHO, WHEN I HAD NEIGHBORHOOD STORES.wONDRFUL , HELPFUL PEOPLE , SORRY, F & iT NEEDS TO BE IN A CLOSE KNIT NEIGHBORHOOD, PREFERABLE WALKING DISTANCE.   E.
Dec 6, 2012 10:00PM
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I loved this store.  Probably because I hate coupons and the process that goes with it.  I like good product at reasonable prices.  Couponing makes you a slave to the process not unlike slot machines.  It is an illusion.  This store gave really excellent products priced for moderate incomes.  They just couldn't overcome the mindsets that many Americans have.  When stores rely on coupons it should send a very clear message to the consumer.  We are charging inflated prices, and in order to bring those prices down to where they should be, YOU have to spend your time and energy cutting coupons. 

 

I just went to the new J.C. Penney's and I love it.  Their have improved the quality of their merchandise and have priced them exactly where they should be.  Screw Wal-Mart and the crappy quality, inferior merchandise and especially the 'seconds' that are not marked as such.

 

My time is valuable and so is my money.  Simply put, I want value for the dollars I spend.  This British chain had the right idea, just the wrong market.

Dec 6, 2012 9:22PM
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I have one of these down the street from me and everything in the store looks GREAT. You get it home and taste it and it is horrible... everything in there except the banana cream pie which they discontinued over a year ago. Their food just is not for americans.
Dec 6, 2012 9:12PM
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I I found Fresh & easy exactly what the name states "Fresh and Easy".  My store always has 98 cent weekly specials along with their other weekly specials.  And you get chances, also on a weekly basis to get $8 off a $40 purchase or  $10 of a $50 purchase.  They are very convenient as for location (as stated in the neighborhood).  At first they carried no national brands, but when they found out that wasn't going to draw customers they added the national brands,  I have been shopping there since day one and have seen there shopping base grow.  I have never bought anything that spoiled a day later.  I can't tell you how many times I have bought "bad" food at Albertsons.  I quit shopping there.  I even sent them an email that returned no response.  Big stores don't care because the masses shop and one unhappy customer doesn't mean anything to them.  I do not let my husband buy meat or fresh items at Albertsons.
Dec 6, 2012 9:02PM
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I never knew about fresh & easy until I moved to Fresno CA. I dropped in to check it out one day and was turned off by the sterile feel of the place. The did carry some unusual items that are not normally found at your local grocery store but nothing I really used. To sum it up my first impression was a plan jane, self serv copy of trader joes. Not that I am a trader joes devotee but I do shop their occasionally for items I can only get their. I prefer whole foods for produce, I do not mind spending a little more for quality also if I only want to buy one apple, peach, squash, etc I am not forced to by four in a plastic container.
Dec 6, 2012 8:56PM
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I'm getting G.D. tired of these videos popping up all the F'n time. 
Dec 6, 2012 8:29PM
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I simply refuse to but at any store that can't seem to hire checkers !! I don't feel like checking out and packing my own items !!
Dec 6, 2012 8:28PM
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Like other posters here, I was happy when a F&E opened near my house. For one thing, the only other nearby grocery was a Ralph's with their ultra-annoying "cards" that they demanded at every visit. (Them: "Do you have your Ralph's card?". Me: "No". Them: "Here's an application and it will count towards today." Me: "I don't WANT a Ralph's card - I want to come in here and pay for my friggin' groceries without having to dig around in my wallet for a stupid card!"). I thought F&E would replace Ralph's as my drop-in place when I needed a pound of butter or some cat food, without the annoying cardism. Imagine my annoyance when, only a few weeks after they opened, I entered the store to see an employee collaring people as they entered to sign them up for a "card" - I was done with them from that moment. I'd rather drive 10 miles to a small chain grocery I patronize because (among other reasons) they never ever ask me for any kind of "card".

Not to mention, why did they call it Fresh and Easy when everyone knows it's Tesco? Are 4 syllables better than 2 in some way? Why discard a known brand name for something no one's heard of before.

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