Analyst: Marketside More Inviting Than Fresh & Easy

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Analyst: Marketside More Inviting Than Fresh & Easy

PHOENIX -- On a visit to three of Wal-Mart’s four new Marketside experimental stores that opened here in October (as originally reported by CSNews Online), retail stock analyst Maggie Gilliam reported the new small-store concept is just another one of many new ideas that the Bentonville, Ark.-based retailer tests on a regular basis.

"Some new ideas never get very far off the ground while others, like Wal-Mart Supercenter and Sam’s Club, evolve into major divisions, but even they required tweaking," she wrote in her November newsletter, Gilliam Viewpoint.

As previously reported by CSNews Online, the 15,000-square-foot stores carry 5,000 to 7,000 value-priced products. In timing and store size, they appear to be direct competitors to the 10,000-square-foot Fresh & Easy stores opened in the U.S. by British retailer Tesco late last year.

Gilliam, though, takes issue with the comparison to Fresh & Easy. "Wal-Mart’s management has long recognized there was business to be had with smaller stores to fill the neighborhood voids not readily reached by Supercenters," she wrote. "We won’t hazard a guess about Marketside’s eventual role in Wal-Mart, but we liked the stores."

Whereas Fresh & Easy focuses on efficiency and offers few amenities, with most of the fresh items packaged at a central commissary, Marketside is more inviting with personal service and a Whole Foods-like emphasis on fresh, with most of the produce loose in open bins and some even hand-stacked, according to Gilliam.

Marketside sells sushi and has a Peet’s coffee bar, along with a large variety of prepared foods. They are not identified with Wal-Mart, and so far, virtually no advertising has been conducted in the market. Unlike Fresh & Easy, Marketside also wasn’t doing much to convey its sharp prices.

CSNews Online has previously reported the current four stores are part of a 10-store pilot test, with another store in Phoenix under construction. If successful, Wal-Mart is looking at other markets for Marketside, including southern California, Chicago and New York.