The long-awaited Fresh & Easy in Loma Linda remains just an empty shell nearly three years after officials got the site at Redlands Boulevard and Mountain View Avenue ready to go.
But now financial woes of the parent company who operates the chain could mean that the Loma Linda location may never open its doors.
After several years of losing profits, Tesco has announced that it has brought in an investment firm to review the finances for the troubled franchise and contends all options are on the table.
Tesco has invested around $1.5 billion into the U.S. stores since opening in the West Coast region in 2007, reported the news site AdAge. The idea behind the British-based company bringing its markets to the United States was to compete with Wal-Mart, but that has not proved to be an effective strategy, AdAge reported.
Close to 200 stores employ more than 5,000 people in Southern California, Arizona, and Nevada, the publication reported. The company opened its first stores in Northern California, San Francisco, and the Bay Area in March 2011.
Tesco reported its first fall in profits since 1994 in October, according to a news release.
“In October, we announced that new capital investment in Fresh & Easy was to be tightly constrained whilst the business focused on reducing costs and improving the profitability of its existing stores,” Chief Executive Philip Clarke said in a news release. “It is now clear that Fresh & Easy will not deliver acceptable shareholder returns on an appropriate timeframe in its current form.”
The company also announced that it would make further announcements for the chain in April when the company’s annual financial reports are released.
“Following a year in which my priority for Fresh & Easy was to improve its performance, I have now made a fully-informed assessment of its longer term potential,” Clarke said. "Whilst the business has many positives, its journey to scale and acceptable returns will take too long relative to other opportunities. I have therefore decided to conduct a strategic review of Fresh & Easy, with all options under consideration.”