SUPERMARKETS & RESTAURANTS: THE LINE GETS FINER

SUPERMARKETS & RESTAURANTS: THE LINE GETS FINER

2008 August
Consumers today are buying almost half of their food at restaurants and takeout establishments, according to the Washington, DC-based Food Marketing Institute, which represents about 1,500 food retailers and wholesalers in the United States and around the world.

There isn’t a huge difference between what a supermarket does and what a restaurant does. Both channels are trying to meet the growing demands of busy consumers who prefer tasty, ready-made meals to go, whether from the gourmet prepared foods section of the supermarket or a restaurant that offers carryout services. Increasingly, supermarkets are crossing the food industry’s competitive lines and joining the restaurant ranks to win back customers and capture a higher-margin business.

The ongoing battle for consumer dollars is what prompted Publix to expand the prepared food offerings in its grocery stores and to invest in Crispers restaurants, which are operated independently of the supermarket chain. Each Crispers restaurant averages about US$1.1 million in annual sales, according to the firm’s 2006 research.

The company had found a way to leverage the synergies between both brands. For example, there are Crispers menu options available in the deli departments of several Publix grocery stores and some of the supermarkets issue coupons for a free dessert at Crispers or a meal discount.  The restaurant chain is also able to capitalize on Publix’s buying power and distribution channels.

Crispers describes its most distinctive offering as the gourmet salad, or spring mix greens prepared with vegetables, fruits and meats. The restaurant carries its fresh, healthy approach over to its “stacked” sandwiches and wraps, which are made to order with a choice of signature dressings.

Many supermarkets have been adding eateries inside or annexed to the store. In the case of Publix and Crispers, although there is some cross-marketing between the restaurant and the stores, and there are some logistics and procurement efficiencies and even a few cross-merchandising opportunities whereby some of the restaurant’s items are for sale in the stores — for the most part, one is a restaurant and one is a supermarket.

Will the Publix method win out over the “internal” restaurant? Maybe Publix knows something the others do not.

(Comments will be reviewed before being posted.)

Jim Prevor is widely recognized as a leader in understanding and assessing the state of the food industry. The founder and editor-in-chief of both Produce Business and Deli Business magazines as well as the Perishable Pundit website.


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Published 29-07-2008 (00:29) by Karen Willoughby

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