Hi everyone,

I thought that this new report on Tesco's expansion into the U.S. might be
of interest.  The direct link to the full report is:
http://departments.oxy.edu/uepi/publications/tesco_report.pdf.

Chris

*****

The Tesco Invasion


August 2, 2007

Contact:
Diana Buckhantz, 323-934-0443, 213-591-1681
Amanda Shaffer, 323- 259-2759, cell 626-818-2348


REPORT ANALYZES GLOBAL FOOD RETAIL GIANT AS IT LANDS IN U.S.

Report Details Tesco's Promises, Policies, and Past Performance

Consumers, community residents, and policymakers need to question and
hold accountable promises made by British food giant Tesco as it
prepares to enter the U.S. market, according to a new report, Shopping
for a Market, by the Occidental College Urban & Environmental Policy
Institute released today.

With plans to open more than 100 stores during the next year under the
name Fresh & Easy Neighborhood Markets in California, Arizona and
Nevada, Tesco intends to replicate its dominant presence in the United
Kingdom, where it commands a 31% share of the grocery industry,
according to the report. Tesco's arrival in the United States has the
potential to significantly influence the direction of the U.S. grocery
business in such areas as labor, environment, health and the food
system, the report says.

"Tesco has been especially adept at marketing itself as a socially
responsible corporation," said Robert Gottlieb, Henry R. Luce Professor
of Urban & Environmental Policy. "However, our examination of Tesco's
track record shows significant gaps between what it has promised and how
it has achieved its current position as one of the top multinational
operations."

"Tesco's move across the Atlantic comes at a moment when issues of food
access in low-income communities, widening income gaps, environmental
concerns, and changing demographics are all on the front burner,"
continued Gottlieb. "We are releasing this report before Tesco's rollout
because we want to provide a comprehensive picture of how the company
operates in the 12 countries where it has set up shop and its plans for
the U.S.."

Key findings in the report include:

Global Position: Tesco is a sophisticated and successful corporation
with strong marketing savvy. Tesco has quickly expanded to become the
third largest global retailer and now challenges Wal-Mart as the most
aggressive and dominant food retailer in many of the places it operates.

Food Access: Tesco has highlighted its commitment to increasing fresh
food in low-income communities by promising to locate stores in
underserved areas. The report finds that 10 of the first 98 Fresh & Easy
sites in California, Arizona, and Nevada can be considered low-income,
high poverty areas. Of those, only one store is located in an urban area
that does not have another full-service grocery store. In some counties,
such as Clark County in Nevada, none of the stores are in high poverty
neighborhoods. Overall, more than half of the Fresh & Easy sites are in
neighborhoods where the median income is higher than average.

Workplace Issues: While Tesco has promised that its U.S. stores will be
a "great place to work," the company has decided to rely on part-time
rather than full-time employees. This limits the ability of workers to
achieve a living wage without having to juggle multiple jobs. Tesco
executives say they are not currently considering engaging in
discussions with local unions -- although they tout a model partnership
with the union that represents their store workers in the U.K.

Health & Environmental Concerns: While Tesco has promoted its
environmental and health-related profile, it plans to duplicate only
some of its U.K. initiatives in this area. For example, it has no plans
to develop a local food sourcing approach nor eliminate genetically
modified food for its house brands.

Supply Chain Issues: Tesco has a global supply chain that involves
thousands of suppliers and subcontractors. Tesco exerts tremendous
pressure over its suppliers to maximize cost savings and production
flexibility.  When supply chain abuses are documented, Tesco says that
it tries to respond, but adds that it is difficult to monitor all the
activities of its suppliers and subcontractors.

The report concludes that Tesco's U.S. operations will utilize what
Tesco has relied upon in its U.K. operations: a strong marketing
capacity and a powerful influence over numerous groups from city
councils to farmers and suppliers. The report presents a series of
recommendations for how Tesco can operate responsibly in its stores and
supply chains.

"As it seeks to become one of the biggest, if not the biggest, grocery
chain in the United States, Tesco needs to be held accountable for its
actions" said Amanda Shaffer, the report's lead author. "We have
identified opportunities for policymakers and community, labor and
environmental groups to establish standards for Tesco and all
supermarket chains. Tesco can choose to take the high road of healthy
food access, quality jobs, and environmental change or the low road of
its main competitor Wal-Mart."

The report is available on the UEPI website at www.uepi.oxy.edu
<http://departments.oxy.edu/>

The Urban & Environmental Policy Institute (UEPI) is a community
oriented research and advocacy organization based at Occidental College
in Los Angeles, CA. UEPI serves as the umbrella for a variety of
affiliated programs addressing work and industry, food and nutrition,
housing, transportation, regional and community development, land use,
and urban environmental issues.