Business & Economy

England-based Tesco may sell Fresh & Easy grocery chain

Tesco, the parent company of Fresh & Easy, said it is considering selling the grocery chain.
Tesco, the parent company of Fresh & Easy, said it is considering selling the grocery chain.
Tesco/AFP/Getty Images

Listen to story

Extra Audio:
Download this story 0.0MB

Supermarket chain Fresh & Easy’s shelf life in its British parent company may not last for long: The chain isn’t profitable and its parent company, Tesco, said it is considering all options— including selling it.

“We’ve concluded that Fresh & Easy is not going to achieve the scale and profitability it needs in a reasonable timescale,” wrote Tesco CEO Philip Clarke in the company’s blog, “Talking Shop.”

Clarke blamed the housing crisis as a reason for why the Fresh & Easy business had trouble taking off. He said when Tesco announced in 2006 it would launch Fresh & Easy in the U.S., the “global economy was flying” and even the brightest economists couldn’t foresee the economic crisis looming in the future.

“Launching Fresh & Easy in the world’s most competitive retail market was never going to be easy, but the economic backdrop made the task twice as hard,” he wrote.

Fresh & Easy has 200 stores in California, Nevada and Arizona. Tesco announced Wednesday that Fresh & Easy’s CEO Tim Mason is leaving the company.

Already, there have been groups interested in buying part or all of the Fresh & Easy chain, Tesco said.

Groups also have interest in partnering with Tesco to develop Fresh & Easy, but Clarke said Tesco is “likely” to exit the U.S. market.

Don Chambers, a regular shopper at the Fresh & Easy near his Lakewood home, said he's disappointed to hear the stores could be sold off, but he's not surprised.

Chambers, 59, said Fresh & Easy would sell great products that would create a strong following among shoppers and then one day, the item wouldn't be on its shelves anymore. That was a bummer for his girlfriend, who loved the store's brand of chocolate gelato, only to never find it again.

"This is kind of stupid, you create a following and kill a product," Chambers said.

Despite the annoyance, Chambers still goes to Fresh & Easy several times a month. It's the only place where he can get products like jalapeno sourdough.

It’s unclear what the impact will be on jobs at Fresh and Easy. The grocery chain said in a statement that it will be "business as usual in our stores."

Clarke wrote in his blog that as the company goes through its review process of Fresh & Easy, “how we do best for (the employees) will be at the top of my mind.”