Tesco readies U.S. grocery debut as activists challenge

LOS ANGELES (Reuters) - Tesco (TSCO.L) will debut its U.S. grocery stores on Wednesday to a select group of local officials, though activists skeptical of the British retailer's promise to bring wholesome foods to overlooked neighborhoods have pledged to challenge the company.

Tesco officially will open six Los Angeles-area "Fresh & Easy Neighborhood Market" stores on Thursday, though at least one of the grocery stores -- in the small town of Hemet, California -- opened last week.

The grocer's U.S. launch is being closely watched, with industry experts predicting it could cause a shake-up of the world's largest and most competitive consumer market. Tesco initially plans to roll out more than 120 stores across the southwestern United States beginning with the Los Angeles area and including San Diego, Las Vegas and Phoenix.

Later Wednesday, Tesco will unveil its first L.A. Fresh & Easy store in the Glassell Park neighborhood, and a group called the Alliance for Healthy and Responsible Grocery Stores has organized a press conference outside the store.

In a statement on Tuesday, the group said Tesco's track record raises doubts about its promises to create good jobs and environmentally friendly stores in neighborhoods that have been ignored by traditional grocers. The group's aim is to strike a binding agreement with Tesco that would insure that local residents share in the benefits of its stores.

London-based Californian Allyson Stewart-Allen, author of the business book "Working with Americans," said Tesco's experience with producing ready meals could provide it with a strong advantage over local players.

"Californians increasingly want ready meals. They are tired, it's 6 o'clock and they've been battling LA traffic for an hour," she said.

But Stewart-Allen warned the U.S. consumer movement is even stronger than in Britain where Fresh & Easy's parent company is a target for criticism by not-for-profits and media angered by its dominance of British retailing and how it has reshaped the consumer landscape.

This week, Los Angeles-area Occidental College professors Amanda Shaffer and Robert Gottlieb said Fresh & Easy's first 13 locations are "primarily in middle-class suburban areas, where income is generally higher than the county average and where the community already has access to a full-service supermarket."

Tesco, which has irked labor unions by opting against union membership for its employees, said on Tuesday that entry-level positions at its California stores would start at $10 an hour.

Employees working more than 20 hours a week will be eligible for health benefits, a retirement plan and quarterly bonuses of up to 10 percent, it said.

Tesco's Fresh & Easy launch is the most high profile British entry into the U.S. retail market, but reflects a wider Atlantic crossing by British brands. Marks & Spencer Group PLC (MKS.L) Chief Executive Stuart Rose said on Tuesday he envisaged relaunching M&S in the United States through its Internet site M&S Direct and luxury-goods brand Burberry (BRBY.L) is opening a slew of stores across the country.

Health-and-beauty chain Boots is seeing success with the sale of its own brand of products in Target Corp (TGT.N) stores throughout the United States.

(Additional reporting by Rachel Sanderson in London; editing by Maureen Bavdek)