More than a convenience store, almost a supermarket, Fresh & Easy hasn't found its place in shoppers' habits.
More than a convenience store, almost a supermarket, Fresh & Easy hasn't found its place in shoppers' habits. - 
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The British supermarket giant Tesco is giving up on the American market apparently Store executives say after five years and no profits, they'll likely sell or close their "Fresh & Easy" neighborhood markets.

Tesco built the smaller format stores in California, Arizona and Nevada in 2007, just as the recession was about to it. They offered fresh food and pre-packaged meals at discounted prices in urban neighborhoods. At the time Fresh & Easy was sold as a convenient alternative to big supermarkets and big-box stores like Walmart.

But Fresh & Easy's format never caught on. International marketing consultant Allyson Stewart-Allen blames everything from bad store lighting to self-service check-out for the store's failure.

And then there is the matter of fruit and veggies. "They pre-packed the produce," Stewart-Allen says. "And anyone that knows the American culture well will know that Americans want to choose their own grapefruit and apples rather than have those selections edited for them."

David Livingston, a retail analyst at DJL Research in Milwaukee, says the chain led people to believe it was going to have "Whole Foods products at Walmart pricing."

"They failed to deliver that," Livingston says. "All hat and no cattle."

When Tesco entered the American market in 2007 some analysts considered it Walmart's worst nightmare. Now, says Stewart-Allen, Walmart is a potential buyer of Tesco's 199 American stores.

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Follow Sarah Gardner at @RadioGardner