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Fresh & Easy Targets Valley Region for Future Growth

Fresh & Easy Neighborhood Market has identified more than two dozen sites for possible store expansion in the greater San Fernando Valley region as part of its larger plan to expand in the Los Angeles area. The three-year-old, El Segundo-based grocery store chain has flagged a total of 70 possible future locations in the Los Angeles area, Fresh & Easy CEO Tim Mason said recently at the Valley Industry and Commerce Association’s 61st Annual Meeting on Dec. 9. “If we can open those 70 opportunities, that will be 1,400 jobs, as well as 300 construction workers per site,” Mason told members of the business organization. “We’re eager to invest, and we want to get on.” The two dozen or so local sites that were identified fall into the region that spans from the Antelope Valley to the north, Camarillo the west and Glendale to the south and east. Brendan Wonnacott, the company’s communications director, said the locations were mainly chosen based on what was open in the market. “It’s really just a matter of looking at the availability and the possibility for locations in the greater Los Angeles area in terms of our roll-out,” he said. The San Fernando Valley already makes up a significant portion of Fresh & Easy’s existing Los Angeles market, with four stores located here out of its seven total in the greater region. The Van Nuys store opened in 2008, followed by three stores in Northridge, Burbank and Sylmar this year. All four stores were redeveloped from former grocery stores or drug stores, and the chain plans to either continue redeveloping existing structures or build from scratch for future sites, Wonnacott said. He added that the stores’ smaller sizes, which are usually around 14,000 square feet, give the company more options for expansion. “We can go to a lot of different spots that were traditionally overlooked,” he said. Growth plan Beside the locations marked for possible future expansion, the company is planning to open 22 new stores in the first part of 2011, with three stores located in the Los Angeles region – Long Beach, San Dimas and Walnut Park, a company representative said. However, Fresh & Easy has had difficulty expanding in Los Angeles, with its current seven-store count waning in comparison to Phoenix with 28 stores and Las Vegas with 21 stores. Mason attributed the difficulty of expanding in Los Angeles to the length of time it takes to receive appropriate permits, the cost of infrastructure, a lack of adequate sites and properties, and the cost of utilities. However, the company still plans to include the region in its growth plan. That is because the area is seen as diverse and growing with a need in some areas for fresh food outlets, Wonnacott said. Fresh & Easy is owned by UK-based grocery retailer Tesco PLC. Competitive Climate While the San Fernando Valley already has a wealth of grocery chains competing for the business of local consumers, Fresh & Easy’s leaders point to the company’s lower-cost, healthier products—which include ready-made meals—to differentiate it. Wonnacott said it is also the grocery chain’s breadth of national brands and Fresh & Easy-branded products that gives it a competitive edge. Other changes in the San Fernando Valley’s grocery store scene also add to the competition. Target is now drawing in shoppers with the company’s new grocery sections that have opened at local stores. The Target at the Westfield Topanga mall just launched its remodeled grocery section in October, following launches at other local stores. Other Target locations that now offer grocery sections include those in Glendale, Burbank, Granada Hills, Northridge, Van Nuys, North Hollywood and west Simi Valley. Sal Penta, store team leader for Westfield Topanga’s Target location, said the remodel seems to be making a good impression on shoppers. “It’s been doing really well,” he said. “Our guests are shopping us more often and we’ve really fulfilled that need of that one-stop shopping destination.” Penta added that Target even has a low price promise, meaning that if a consumer can identify a similar item at a lower price elsewhere, Target will match that price. Meanwhile, one chain has left the San Fernando Valley market. HOWS Markets just closed its Granada Hill store. The company has also already closed its Torrance site and plans to close its Malibu site, with its store in Pasadena the only one to remain open, said an employee from HOWS Markets’ headquarters.

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