Hokuto-shinken wrote:Yes, it is the same as Tesco Metro in the UK...Still, Tesco is not the first foreign combini.

gomichild wrote:Well Japan 7-11 owns the American 7-11 now http://www.7-eleven.com/about/history.asp

The Wall Street Journal: Why is Tesco setting up shop in the U.S.? Aren't there enough grocery stores already?

Mr. Leahy: There is no shortage of stores. But it is a place that rewards innovative retailers, so if you do something different, you get rewarded for it. Retailing returns in America are quite good by international standards.

WSJ: Why didn't you just buy an American supermarket chain?

Mr. Leahy: We didn't want to buy an existing business because what's the point of going to America and just doing the same as everybody else? There is already so much retail there. So what we tried to do is turn a weakness we had -- that we had no presence in America -- into an advantage: We can research and design the perfect store for the American consumer in the 21st century.

Our team went over to live in the U.S. We stayed in people's homes. We went through their fridges. We did all our research, and we're good at research.

WSJ: What did you find out?

Mr. Leahy: Americans shop in more stores than, for example, the British shopper. No one store gives them everything they want. You would think it is the home of the one-stop shop but it's not. I think they feel the one-stop shop -- the big-box retailer -- doesn't quite do it on the food quality, the fresh food. Whereas here, more people are content to do their whole food shopping in one place.

WSJ: You have been very secretive about the prototype for your American stores.

Mr. Leahy: We built the store inside a warehouse. We claimed it was a movie set so that people would deliver all these goods and not think it was us. We had to borrow products from other retailers because we hadn't at that stage developed any products. We took ordinary people in, and they really, really liked it.

WSJ: Isn't it daring to challenge Wal-Mart on its home turf?

Mr. Leahy: Wal-Mart is a great retailer, but America is a big place. The part of the market that we are addressing, which is convenience, is an underinvested part of the market. And I think there is plenty of room in the market now.

WSJ: But Wal-Mart also has smaller stores called Neighborhood Market. Isn't it competing for the same turf?

Mr. Leahy: No doubt it is. But it's a big segment. A Wal-Mart Neighborhood Market would be more their version of an American supermarket. We would be approaching it from a slightly different angle.

WSJ: What are you most proud of in your U.S. stores?

Mr. Leahy: The tortilla is going to be pretty good. And some of the wine will be pretty good. We're very proud of the wine.

WSJ: Are you planning to become a national chain in the U.S.?

Mr. Leahy: The West Coast of the U.S. is a big place. California is virtually the same size as the U.K., and we're starting in California, Arizona and Nevada, so there is a lot to get our teeth into. But hopefully, the format will have a wider appeal than that.

WSJ: Of all the markets you have entered, which one has been the toughest?

Mr. Leahy: Japan is very challenging because it's a very well-defined society in terms of its value systems, and they're very confident consumers.

WSJ: Carrefour has withdrawn from Japan, and Wal-Mart is struggling there. What mistakes are you trying to avoid?

Mr. Leahy: We didn't go in in a big way. We could see it was complex. Again there, we lived in Japanese homes and spent three years researching Japan.

We didn't bring our format in. Carrefour brought in the French hypermarket. We bought a small business in the convenience sector, which we thought suited shopping in Japan. People shop every day. Small is beautiful in Japan. Western concepts of large, big, extra value don't work.