CMO Says Wal-Mart's Watching Tesco's Every Move in the U.S.

Wal-Mart's keeping close tabs on its prime global competitor, Tesco, regarding the latter's U.S. operation Fresh & Easy Neighborhood Markets, admitted John Fleming, Wal-Mart's chief merchandising officer, at a Bank of America conference yesterday.

Fleming, who spoke at the investors' gathering, said, "We have people in those stores every day, every week," referring presumably to the close to 80 stores that Tesco's Fresh & Easy division has opened so far in California and the Southwest. "We continue to monitor the progress that they make," Fleming said.

Many industry observers consider Wal-Mart's own nascent small format, Marketside, to be a potential response on Wal-Mart's part to the Tesco's U.S. invasion via Fresh & Easy. The first four Marketsides are expected to open in coming weeks in Gilbert, Mesa, Chandler, and Tempe, Arizona.

In his talk, which was Webcast, Fleming said Wal-Mart is exploring various store formats beyond the ubiquitous monster supercenter, and that "convenience is certainly a trend in the future," presumably a reference to the Marketside strategy, which is to offer fresh destination stores of just 15,000 to 20,00 square feet for its customers when their need states dictate a quick trip to pick up a small amount of perishables.
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