The Guardian has an interview with Tim Mason, the former Tesco executive who was sent to the western to run its Fresh & Easy Neighborhood Markets division - which was such a debacle that in 2013, after having lost more than $2 billion, it filed for bankruptcy and persuaded billionaire/supermarket speculator Ron Burkle to take it off Tesco's hands.
“It was a great business,” Mason says. “There were many very good reasons, not least the economy, that meant it was somewhere between very difficult and impossible to be successful in the timeframe ... If Tesco had been financially stronger, the business could have taken everything it learned over six years and refined and developed the model and got it to an acceptable place. Unfortunately there wasn’t that economic firepower. There were problems all over the place, not least in the UK, and the decision was made.”
“It was a great business,” Mason says. “There were many very good reasons, not least the economy, that meant it was somewhere between very difficult and impossible to be successful in the timeframe ... If Tesco had been financially stronger, the business could have taken everything it learned over six years and refined and developed the model and got it to an acceptable place. Unfortunately there wasn’t that economic firepower. There were problems all over the place, not least in the UK, and the decision was made.”
- KC's View:
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I'm willing to accept the premise that Tesco's problems at home - where growing competition from discounters was pressuring profits and margins - perhaps meant that it could not sink any more money into Fresh & Easy ... but give me a break.
Many of the Fresh & Easy stores I was in were ill-conceived, in questionable locations, and with very little sense of the local market. I've never met Tim Mason, but I understand that from people who know him that he is a smart, nice guy.
And I feel bad for him. Mason worked at Tesco for three decades, and it all came crashing down on him.
That said ... I can vividly remember Ian Lord Maclaurin - who preceded Terry Leahy as CEO, telling me 25 years ago that opening stores in the US would be an utter disaster for Tesco, and would never happen. (I think he never changed his mind on that, despite what his successors did.)
For Mason to suggest that Fresh & Easy's failure was just because Tesco had to tighten the purse strings strikes me as revisionist history at best, and utter denial at worst.
