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CRACKER BARREL WITHDRAWS FROM HMR FRAY

LEBANON, Tenn. -- Customer confusion over the Cracker Barrel brand did in the food-service operator's attempt to crack the home-meal replacement market, said a company official interviewed by SN.Cracker Barrel has fully withdrawn from the HMR fray for now, having closed its three Cracker Barrel Corner Market restaurants.The Corner Market restaurants, which served hot entrees, side dishes and salads

LEBANON, Tenn. -- Customer confusion over the Cracker Barrel brand did in the food-service operator's attempt to crack the home-meal replacement market, said a company official interviewed by SN.

Cracker Barrel has fully withdrawn from the HMR fray for now, having closed its three Cracker Barrel Corner Market restaurants.

The Corner Market restaurants, which served hot entrees, side dishes and salads cafeteria-style and packaged for take-home, were dramatically different operations from the 260 giant Cracker Barrel Old Country Stores that dot interstates in 28 states.

"We found that there was some confusion among our customers who'd come into the Cracker Barrel Old Country Store looking for things we only sold at the Cracker Barrel Corner Market, and the other way around," said Jim Fisher, vice president, marketing for Cracker Barrel. "The business was confusing people and we were not getting the dollars that we were looking for."

Much smaller than Cracker Barrel's other units, the home-meal replacement operations were located in three high-traffic urban settings in Tennessee -- two in Nashville, and one in Mufreesboro.

The 100,000-square-foot Cracker Barrel Old Country Stores mix family-style cooking and table service with an in-house country-style shop, selling crafts, hats and other casual gifts.

Fisher said that while the Corner Market menu was based on food served at Cracker Barrel Old Country Stores, the selections at the two formats were not identical, and as a result customers weren't sure what they were getting when they walked into either operation.

Neil Stern of McMillan/Doolittle, a Chicago retail consulting firm, said the format "wasn't working for a lot of reasons." The original concept -- stores selling self-serve chilled food stocked in cold cases, as well as Cracker Barrel toys, gifts and products -- changed quickly, first with the addition of hot food, then seating and finally drive-ins.

"I think this is still a category with a lot of interest for us," said Fisher. "We see these three shops as a laboratory. The No. 1 lesson for us is that Cracker Barrel has a strong brand name and we have to be careful about marketing in a way that confuses customers."