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 6, 2012 5:59PM
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I don't know about the experts in this article, but I found Fresh & Easy to be the perfect grocery store. Leagues better than Ralph's, Albertsons, and yes, even Trader Joe's! Very affordable, lots of coupons offered, clean, FUN, well-designed, and great food (national and store-branded items). And other than a few British items, there was no obvious Tesco influence to supposedly turn off Americans. Shopping there was a pleasure, and my friends and I will truly miss it. I don't know where I'm going to get my groceries now.

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 6:58PM
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I love Fresh & Easy! The rewards program is great. Everything I buy is fresh & delicious, from the fresh fruits & meats to the pre-prepared items. There's something for every cook. Sometimes I like to make everything from scratch; sometimes I like to cheat a little; sometimes I just want to reheat & eat. The prices are good, too. I wish they did take manufacturers' coupons, but the coupons they do offer are great.
Dec 6, 2012 6:44PM
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What a shame!  I adopted them as my grocery store due to very competitive prices, the best produce in town, the friendliest staff in this state, and the best hummus I have found in the nation.  I will once again be stuck with the mediocre food of American chains, staff who ignore me, and no more hummus unless I can afford to go back to Turkey for a visit.
Dec 6, 2012 5:40PM
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Fresh and Easy market is the best for me!  The commodities are fresh, prices are reasonable.  Let us  start to patronize healthy products!
Dec 6, 2012 6:47PM
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This is a huge bummer for me - I actually like most of their products and F&E is the easiest 'in and out' grocery around. I hate having to go to the back of the huge Walmart, Albertsons and Smiths stores just to get a gallon of milk.  F&E is fast and convenient.  It took me awhile to warm up to them, guess that's what I get.....
Dec 6, 2012 12:04PM
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Too bad for them; the problem is that most Americans don't eat healthy so they would rather go to traditional grocery stores in order to get thier fill of junk food. The most of us who eat healthy are still the minority against the majority of Type II Diabetics who can't run out of their own home without being out of breath.
Dec 6, 2012 7:06PM
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I hope this doesn't happen!!  Our local Fresh & Easy is my primary grocery store (over Vons and Albertsons) because they have the best prices and excellent prodcuts.  AND, they by far have the BEST coupon deals over any manufacturer's coupon.  On average for a large shopping trip ($125-150), I could save upwards of $25 using their in-house coupons.
Dec 6, 2012 6:32PM
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I like their organic products from produce to dairy to pastas and pasta sauce.  I don't go for their quick fresh meals or frozen processed meals but I like their choice of offerings.  It's about half the distance to a Trader Joe's and that's what got me goihg there in the first place, plus I use their coupons religously.  I'"ll be sad if they close down.

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 6, 2012 5:52PM
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This sucks. I like my fresh and easy store. I can get more organic foods at whole foods or trader joes, but I never go to trader joes. I don't like it. I can get better deals at whole foods; I get more for the buck. Whenever I go into a trader joes I walk out with nothing. It is always a disappointment to me, and I have never understood the big deal about it. However, fresh and easy is closer to me than whole foods, in fact, it's right next to my church, so I stop in there to get my organic almond milk or gluten free cookies that are hard to find anywhere else. I would shop there more if I could get organic meats or organic fresh produce, or the dairy free yogurt I can eat, they hardly ever carry the flavors I can. I think the cost of fresh and easy is affordable. Eating healthy, I've been to far more expensive grocery chains. A co-op I went to used to shock me every time I checked out. I could never understand how the cost was that high, but fresh and easy prices work for me.
Dec 6, 2012 12:50PM
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 6, 2012 8:07PM
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Never heard of the store until this article. Perhaps that's their problem.
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 6, 2012 11:27AM
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I could have told them the first day they opened they would fail.  This is a classic example of terrible market research.  Don't forget to fire your market research consultants while you are closing your stores.
Dec 6, 2012 6:14PM
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I like Fresh and Easy, it was a nice place to stop by and get a quick dinner that wasn't frozen. Its prices are competative. We were hoping that one would open in our neighborhood, maybe their Market Research firm thought opening in a Lower Income area was good, but for me the area they chose in my City was not the best.
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 5:59PM
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PS: Are there any commercials of fresh and easy on tv? What about bulletins? Radio announcements?
Dec 6, 2012 6:14PM
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Ah, fresh and easy.  How I long for those bygone highschool days with Janie.
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