Wal-Mart officials plan to open new small-format grocery stores in Arizona this year. The move is seen as a response to United Kingdom-based grocer Tesco's agressive move into the U.S. market.

Wal-Mart spokesperson said, "We trial and test different ways to serve our customer all the time, and this smaller neighborhood market is an example of that."

The pilot stores are to be called "Marketside." They will be about 20,000 square feet-- one-tenth the size of a Wal-Mart supercenter. It also is smaller than Wal-Mart's "Neighborhood Market," which is roughly 35,000 square feet. That version was launched in 1998 to address the needs of people who prefer smaller shops, such as the elderly.

TNS Retail Forward, a global market insight group, has said that Tesco's arrival in the United States would have a huge impact on the domestic retail food industry.
Source: Meatingplace.com