Fresh & Easy supermarket. (Photo: StockFile)
UNITED STATES
Wednesday, February 06, 2013, 01:40 (GMT + 9)
Fresh & Easy has addressed social media to assure customers that its Neighborhood Market stores will remain open despite the outcome of a strategic review by owner Tesco.
In December 2012, investment bank Greenhill & Co launched a review of Tesco, which introduced the notion that the company might exit the US market. But Fresh & Easy has taken initiative, putting up the logo “Fresh & Easy Still Fighting the Good Food Fight,” addressing its fans on Facebook and telling them they will still be able to shop at its stores even if the company is sold or partnered up.
“While we don’t know exactly what the outcome of this strategic review process will be, we want to assure you we don’t have plans to close stores and we’re confident Fresh & Easy can continue to be your favorite neighborhood market,” the firm posted on its Facebook page on 31 January.
The grocery said there will be a campaign that will include radio advertising. The Packer reports.
“A strategic review always causes uncertainty, with competitors unnerving staff and customers,” said Clive Black, an analyst at Shore Capital in Liverpool, England, Bloomberg reports. “So I’m surprised this campaign has taken as long as it has.”
Since opening in 2007, Tesco has opened about 200 Fresh & Easy stores in California, Nevada and Arizona – and failed to make a profit.
Tesco CEO Philip Clarke said in December that revenues had been poor and insufficient to support its investment, worth around USD 1.6 billion.
“It is now clear that Fresh & Easy will not deliver acceptable shareholder returns on an appropriate timeframe in its current form,” he said in a statement at the time.
Since then, he told, other companies had voiced interest in buying all or part of the Fresh & Easy chain or in partnering with it.
Bob Goldin, an executive vice president at market research firm Technomic, thinks Fresh & Easy's problem could be that it sells packaged foods that fail to resonate with its customers. In addition, the stores do not present the lowest prices or even the best selection, he said, and he expects that discount retailers like Dollar General may end up buying and rebranding Fresh & Easy's locations, CSNews reports.
Related article:
- Tesco may pull out to focus on other markets