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UPSCALE SPREAD

By JACK ROBERTIELLO CHARLOTTE, N.C. -- In this growing New South city, Dean & Deluca has opened the first of three prototype stores to be introduced this year -- stores that may be harbingers of a national chain that could offer sharp competition for dollars spent on fresh foods and on fresh meals in particular.ey perishables, but Dean & Deluca's few shops and cafes in New York and Washington hardly

By JACK ROBERTIELLO CHARLOTTE, N.C. -- In this growing New South city, Dean & Deluca has opened the first of three prototype stores to be introduced this year -- stores that may be harbingers of a national chain that could offer sharp competition for dollars spent on fresh foods and on fresh meals in particular.

ey perishables, but Dean & Deluca's few shops and cafes in New York and Washington hardly qualified as competition.

After all, a supermarket charging for fresh foods what Dean & Deluca does would be establishing a risky new pricing strategy -- EDHP, or everyday high prices.

However, the operator's latest moves reveal a shift in philosophy, as the company nears entry into the national market. And the vehicle for that entry is fresh meals.

Although prices are slightly lower here than in New York or Washington, it's not that the new store has set out to change the company's reputation for expensive foods; an average dinner for four -- store-made lasagna, salad, baguette, dessert and a bottle of wine -- purchased here will run consumers about $43, well above most supermarket offerings.

What Dean & Deluca executives have done, though, is try to expand the company's coveted sterling reputation into the highly competitive high-end meals business.

Dean & Deluca stores in New York and Washington typically split sales about 80/20 between supplied items and store-manufactured goods, said Matt Wogan, director of operations for the Charlotte store, as well as the soon-to-open unit in Kansas City, Mo.

At the new format, with a full-fledged bakery, meals stations and an emphasis on all three aspects of home-meal replacement -- ready-to-cook, ready-to-heat and ready-to-eat -- the split is expected to be closer to 50/50.

"We've taken the design points of the original Dean & Deluca stores and expanded them by creating the new stations," Wogan explained. "We are in theme with the tradition of Dean & Deluca, and we do not want to go away from that."

Wogan sees Charlotte as a good place to start. "There's plenty of room in the Charlotte market. It's in the midst of strong growth and has been for the last few years. A lot of people are moving here from other parts of the country, and Charlotte now has a strong food sense. We think people appreciate the food here, and that the clientele warrant there being a Dean & Deluca here."

The trick will be translating the company's expertise in introducing, promoting and merchandising fine foods into their meals venues, he said.

"We have put more emphasis on the prepared-foods venue, but the store is still very much a mirror of the New York and Georgetown locations, with full blown cheese and charcuterie, meat and seafood and produce departments."

While the company's other stores offer baked goods and bread, those are bought from outside vendors. Here in the 8,900-square-foot Charlotte store, with the exception of some fine cakes and pies that come from local pastry chefs, all goods are baked on site. That includes 29 types of bread, 12 types of pie or tart, six types of cake, five types of bar or cookie, and 18 breakfast pastries.

There are new meals service stations, a salad area and a combined pasta/Asian venue in addition to the company's traditional prepacked sandwiches, and prepared-foods area -- which here is called the "Chef's Case," where hoisin chicken wings, grilled summer vegetables with balsamic vinaigrette, horseradish crusted salmon and black bean carnitas burritos, among 31 other dishes, are merchandised on white platters.

At the salad area, customers can order classic salads or design their own from a broad collection of greens, vegetables, such proteins as chicken, shrimp and salmon, and eight dressings. Staffers toss salads per order, and single- and double-serve prepacked Greek, spinach and Caesar salads are merchandised in refrigerated cases along the wings of the service area.

"The point is to have the same things merchandised right there for customers who are in a hurry," said Wogan. "It works well to have those salads right in the salad venue, but we do have other locations in the store that we could merchandise and may merchandise the prepacked items in."

A similar setup at the combined pasta/Asian counter allows customers to choose from a variety of two fresh pastas -- supplied by a local provider -- that can be cooked at home, a selection of cooked noodles, or a dish whipped up to order from one of two daily pastas, one of seven sauces and a variety of additions such as roasted mushrooms, capers, meatballs, sausage and shrimp.

And at the Asian station, the choices include egg, vermicelli and rice noodles, Thai curry sauce, Japanese miso broth and classic Chinese brown sauce with many Asian-style add-ons. Similar abundance is at the other meals stations. "We encourage everyone to taste the sauces and make their selections from what they like, so there's a lot of sampling going on at this venue," said Wogan. "You can pretty much create your own Asian takeout."

Since opening last month, the store has been changing the sales mix throughout the day. Sandwich business has been "tremendous" at lunch, Wogan said, while dinner hours have attracted more business at the Chef's Case and meal venues. There's a steady customer flow through the afternoon, and in the evening the espresso bar and light fare areas get busy, as nearby movie theaters empty. Seating here allows for about 50 people on the patio and another 16 inside.

Wogan calls the development in Charlotte's Southpark that houses the store -- within a mile of Harris Teeter's flagship store -- a sort of planned town/outdoor mall, with specialty retailers, movie theaters and four restaurants. It's meant to attract both foot and auto traffic, with customers coming from the daily mix of mall shoppers, apartment renters and workers from office parks.

The employee mix is primarily local, staffed, as Wogan said, "by the power of Dean & Deluca. We're very happy with the cast we've hired. Dean & Deluca attracts people who have a passion and love for food. As long as they have that, we believe we can technically train them from an operations standpoint. But most of the people we've hired down here have experience in the venue we've placed them in. It's very important to hire someone who has competency in their areas."

As for the challenge of attracting attention from locals who may not have heard of the company and its reputation, Wogan is unconcerned.

Word-of-mouth is spreading, he said, and with no advertising the store is off to a "pretty good start. Everybody's getting to know us; the word is out."