Tesco, Once the Walmart Killer, Limps out of USA



Little Rock  It was only a bit more than 6 years ago when grocery unions feared that Tesco, the giant United Kingdom grocery conglomerate, might have found the secret sauce in both beating unions and Walmart although with labor’s West Coast containment strategies as they entered Los Angeles with what seemed a nearly unbeatable small store, fresher food, hot meals model.  Walmart for decades had had its way with store expansion throughout the country in rural, suburban and exurban areas, but as it encroached on East and West Coast cities, its giant footprint, superstore model conflicted with a host of other urban land use values and interests, so victory was never assured, but at least on a case by case basis was finally possible.. 

            This had certainly been the case with our Walmart organizing in Florida where between 2005 and 2008 we were able to block openings of 32 consecutive superstore proposals along the corridor between Tampa/St. Pete and Orlando.  We had taken our inspiration and often partnered with unions and community efforts in California where many of the same techniques had been pioneered and where land use laws were the best in the country with many jurisdictions outright banning store footprints of over a 100,000 square feet thereby putting a stake in the heart it seemed of the Walmart superstore model, requiring numerous regulatory obstacles to be mastered before construction.

            Tesco’s announcement then that it would take Los Angeles by storm with its small stores sounded like nothing but trouble.  A smaller footprint meant that they could immediately open in some locations then empty that had once held similar stores.  Many of the California tools wouldn’t work.  The UFCW launched an organizing project designed as much to harass Tesco as organize workers.  There were some picket signs.   There were conversations with customers about quality and offerings.  Hopes that the fact that Tesco was solidly union in Britain and that such leverage might give hope to unions in the USA were swiftly found to be futile.

            Now 6 years later, Tesco has announced that it is throwing in the towel.  The cost of obtaining their “get out of the USA” visa was said by their executives to be between $1.3 and $1.8 billion dollars.  What killed them according to reports is that they underestimated the American consumers.  The same reports infer indirectly that we Americans just like big stores, cold food, and stale products. 

            Having been there at the beginning I wonder if the Tesco story might have been different if it had not come in spoiling for a fight, but instead had been looking for love from American workers and unions.  No matter how big and bold, it’s never easy to move to a new country if your message is mainly that you are ready to take on all comers, rather than realizing they have to feel the love and spend their money with you.

Tesco Audio Blog