All the years of effort that supermarket retailers have put into their prepared food departments finally seem to be paying off. In fact, supermarkets are expected to sell $25 billion worth of prepared food in 2008, according to recent data from Technomic, a Chicago-based restaurant consultancy.
This strong showing should come as little surprise. This year, SN has reported on independents that have successfully expanded their catering operations, chains that are testing the appeal of exciting new ethnic cuisines, and even retailers that are experimenting with curbside takeout.
But these developments are hardly isolated. They're part of an ongoing shift in how supermarket prepared food is viewed by both its purveyors and consumers. Operations at companies such as H.E. Butt's Central Market, Whole Foods Market and Publix Super Markets are already exceeding the quality of most casual dining chains, and when it comes to bringing home dinner for four, the convenience of these formats goes without saying.
Ron Paul, president of Technomic, said retailers that are looking to take their prepared food departments to the next level should focus on three key areas in the coming year: quality, convenience and fulfilling the entire meal experience.
“Make sure that food quality is comparable to restaurant quality,” he said. “The gold standard is restaurants, and that's who you're competing against.”
Second, while retailers already have some advantage in terms of convenience — since shoppers are already in their stores planning to buy something — they should work on making the prepared foods experience as seamless as possible.
This doesn't necessarily mean testing a curbside service program, but department managers need to facilitate a fast checkout, particularly for items that are intended to be taken out hot, Paul noted. “If you can have dedicated pay stations, do that, so that customers don't have to get in line behind someone with 85 items in their basket,” he said.
Finally, “make sure you help fulfill the entire meal experience,” Paul said. “Make sure it's easy to pick up the other items — the side items, the desserts, the salad, the appetizer — the things that round out the meal.”
Again, this doesn't have to mean imitating current casual dining trends and promoting bundled deals all of the time. The presentation should simply give shoppers the impression of one-stop convenience and plenty of options.
For example, Norm Vernadakis, director of deli, bakery and food service for Big Y, noted during a prepared foods roundtable discussion hosted by SN last spring, “when you're dealing with a family, it's harder to make a bundle that's acceptable to the entire family.”
While Big Y stores do offer plenty of side dishes, and do offer value meals and side bundles during lunch, he noted that many shoppers come into the prepared food department planning to shop other areas of the store as well.
“With our core market areas, we find that customers will pick up that core center of the plate, and then worry about the rest of it when they get home,” Vernadakis said.
With high gas prices keeping many shoppers closer to home, supermarkets have a real window of opportunity to showcase the quality of their prepared food, as well as its inherent convenience.