The Food Scout

Over the past several years, the grocery industry had been opening stores whose square footage rivaled that of Wal-Mart’s warehouse-style Supercenter format. But now the interest seems to have shifted to smaller “urban” formats, particularly since leading UK retailer Tesco introduced its Fresh & Easy corner store concept a year ago and started proliferating dozens of them (now totaling more than 70) in a few concentrated markets on the West Coast.

In direct contrast to 80,000 to 120,000 sq. ft. stores that were the trend, now Safeway, Wal-Mart, Giant Eagle, Schnuck’s and even Whole Foods have since opened smaller grocery footprints in the 14,000 to 17,000 sq. ft. range, usually with a larger percentage of fresh and prepared foods in the store mix.

Tesco has had its share of detractors, and while the company recently announced it was slowing down the conveyor belt that produces new Fresh & Easy formats, the competitive wheel has been set in motion, nonetheless. Wal-Mart’s CEO Jeff Scott acknowledged to a group of financial analysts in September that Tesco’s venture was likely to be successful, which is probably why Wal-Mart launched its own test concept called “Marketside” a month before that meeting.

Safeway opened its own “The Market” concepts in May of this year in Long Beach and Belmont Shore, Calif. Also on the left coast, Kress IGA opened in downtown Seattle this year, a small but premium-assortment store that has limited parking.

But the inspiration doesn’t stop on the West Coast. Midwestern Schnuck’s announced in February that it was opening a smaller store in downtown St. Louis, but Supervalu delivered on the idea with its “Urban Fresh” concept in downtown Chicago that premiered in September, perhaps to trump Tesco, which is said to be planning a Midwest advance in the future. Hyvee just this month opened a 15,000 sq. ft. grocery store in an urban section of Lincoln, Neb. Giant Eagle on the East Coast opened an Express concept that features fresh and upscale foods as well. There is also talk among a variety of other regional grocery chains to return to urban neighborhoods that are called grocery “deserts” by communities due to the closure of supermarkets that had become run down and neglected.

So just as Boston Chicken turned America’s collective supermarket deli section on its ear and created a scramble to deliver fresh prepared foods a little over a decade ago, the British have come along and inspired yet another wave of improvement to address the need for prepared dinners that has been largely filled until now by restaurant takeout and the emerging “meal assembly store” business.