The news that Tesco, one of the world’s largest retailers, was planning to introduce a grocery concept in the U.S. sent shockwaves throughout the market. Now that the British company’s Fresh & Easy Neighborhood Market is here, the buzz is even louder. Wal-Mart has even introduced a new food concept that everyone is sure is a reaction to the Tesco invasion.

Making its debut in parts of California, Nevada and Arizona, the Fresh & Easy format is, at roughly 10,000 square feet, about one-fifth the size of the typical American supermarket. The stores emphasize fresh foods, appetizing prepared meals, a low-key but inspired shopping environment. And they’re designed to carve out a space right between America’s traditional grocery stores and quick-grab c-stores.

Kevin O’Donnell, creative director at Schorleaf, the Los Angeles-based branding, design and fabrication company that worked with Tesco, says Fresh & Easy was never looking to blend in on U.S. soil. “We knew right from the beginning that the store had to be unapologetically new,” says O’Donnell. “They wanted to throw aside the way things have been done in the past.”

But how do you make a splash when the landscape is already saturated with supermarkets, hypermarkets, convenience stores, and a new sub-niche of organic, nutritious specialty retailers?

First, you create a more efficient shopping experience. With U.S. retailers rolling out bigger-is-better and shop-within-a-shop concepts, Fresh & Easy is aiming for a quick one-stop shopping experience. “They figured if they built a smaller store and picked just the right merchandise selection, they’d be able to get people in and out very quickly,” says O’Donnell.

As the name might suggest, the store is divided into two sides: the fresh side, where produce and prepared meals are sold; and the easy side, where they’ve edited down the dry and frozen food selection, including private and national brand items, to make shopping convenient and quick. Endcap displays calling out seasonal or featured items also aim to improve the shopping experience.

The retailer sought an unusually small back-of-house area, so warehouse-style shelving holds most stock on the floor in original shipping boxes or on pallets. A sophisticated merchandise tracking system alerts Fresh & Easy when a specific SKU is low, so fresh product can be delivered and put on shelves the next day.

As the finishing touch, Fresh & Easy employs only self-checkout lanes, a system that reduces labor costs and provides (or at least implies) speedy checkouts.

O’Donnell says another distinguishing factor for Fresh & Easy is the food quality, especially the prepared foods. All fresh items are stamped with a date, indicating when an item must be sold or taken off the shelves. Also, “The Kitchen Table” tasting station offers shoppers samples of juices, private label products and ready-made meals.

While Whole Foods has won over shoppers with artistic produce displays that invite customers to touch, grab and feel, Fresh & Easy pre-wraps its apples and bell peppers. The effort helps cut down on costs and get food to market quickly. But it could also be a hurdle for American shoppers not used to this more European way of display. O’Donnell believes that once shoppers get the food home, they’ll realize the quality. “Fresh & Easy is serious about the freshness,” he says.

Fresh & Easy stands in line with its U.S. counterparts in employing an environmentally friendly store design. The chain is currently testing LED lighting in its ice cases; using skylights to optimize natural lighting; and installing covers on its refrigerated displays at night. But the company aims to eventually surpass the competition by certifying new-build stores in the future under the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) rating system for volume-certification.

Fresh & Easy plans to test the waters in the Southwest before turning its eye to every major market in the U.S. Parent company Tesco has already proven it has the mettle to succeed, growing into the U.K.’s largest retailer. Its impact in the U.S. may prove who will sink and who will swim.

Inside Story:

– Schorleaf conducted consumer testing and built a mockup store in a California warehouse without knowing whom it was actually working for.

– After eight months on the project, designers found out that the concept was for U.K.-based Tesco.

– Executives originally used the name “Fresh & Easy” as a working title, but in the end, decided it summarized exactly what they wanted to bring to the U.S.

Project Suppliers:

Client: Fresh & Easy Neighborhood Market, El Segundo, Calif.

Design: Schorleaf Inc., Phoenix and Los Angeles

Architect: Little Diversified Architects, West Covina, Calif.

General Contractor: Eleven Western Builders, Escondido, Calif.

Outside Design Consultants: Deutsch LA, Los Angeles (brand development, package and graphic design, marketing); Pemberton & Whitefoord, London (package design)

Developer: The Bergman Cos., Chino, Calif.

Furniture, Millwork, Signage/Graphics: Schorleaf Inc., Phoenix

Wallcoverings and Materials: Benjamin Moore Paints, Montvale, N.J.; Formica, Cincinnati; LG Hi-Macs, Peoria, Ariz.

Photography: Tom Bonner Photography, Santa Monica, Calif.