Tesco, Wal-Mart and Whole Foods switching sides

With all the attention being paid as Tesco goes to America, it is worth noting that ever since Safeway sold its UK operation in 1987, the trend has actually been the other way, with UK retailers bailing out of America and US retailers making inroads in the UK.

Marks & Spencer sold the New Jersey-based Kings to a private equity group.  Sainsbury was Britain’s largest food retailer, the position Tesco holds today, when it purchased Shaw’s in 1983. It traded for two decades and bought up competitors and additional stores. Then in 2004, Sainsbury abandoned America and sold Shaw’s to Albertson’s.

In contrast, Wal-Mart acquired ASDA in 1999 — a major buy of the third largest supermarket chain in the UK. This entry in the UK market followed Costco’s opening of its first UK warehouse in late 1993 — it now has 20 warehouses in the UK, including a new one in Chester. Now Whole Foods is preparing for its launch in the United Kingdom. There is both a macro and a micro question that will play out in this launch.

There is some question as to whether, inherently, Whole Foods won’t represent to the “green” consumer a hostile “big organic” approach that is really counter to the trends in the UK that include highly local buying and ecologically diverse box schemes.

The macro question is whether the UK’s more intense focus on environmental and human rights issues will play in Whole Food’s favor or not? Although intuitively it seems that consumers who focus on these issues will be consumers attracted to the Whole Foods’ offer, the greater saliency of these issues with the consuming public means that mainstream retailers in the UK have addressed these issues to a far greater extent than mainstream US retailers.

(Source: Perishable Pundit)