EAST/BAKERY: HARRY'S

LOUISE KRAMER

ATLANTA -- Bakers kneading dough. Decorators piping icing roses on custom-ordered birthday cakes. Pastry chefs fanning out sliced apples onto tart shells.

This is the show many top retailers put on every day in their bakery departments to put their shoppers in an impulse-buying mood. These tactics tell customers that something special, something fresh, is going on.

None of these particular theatrics are in evidence at Harry's Farmer's Market here, where prepacked bread baked off premises, and plenty of it -- some 60 choices daily -- dominates the product mix. And according to Neil Stern, a partner with the retail consulting firm McMillan/Doolittle, that's what sets the company apart.

"Harry's bakery is leading edge because they have gone after one product category and absolutely dominated it. Not only beyond any supermarket, but beyond any gourmet shop," said Stern, who recently visited the bakery at Harry's newest store, in Marietta, Ga. It is the retailer's third full-scale store.

"They are the very best bread retailer in America, bar none," said Stern, who judged the 1994 Leading Edge Awards, co-sponsored by the Retail Bakers of America and SN. "They are selling 50 varieties of fresh bread every day. European flat bread and Afghan breads and rye breads and dessert breads. It was just unbelievable. And the product, when you try it, is also unbelievable."

Stern said sales volume helps such variety thrive. Harry's, he said, averages close to $1 million per week per store in sales.

More than 90% of all the bakery products are produced fresh daily and removed from the shelves, if not sold on the day made. All bakery dough is made from scratch-blended ingredients, according to the company. Stern said the bakery is not well-rounded in terms of its overall mix, but that, he said, is the point. "All too often, retailers are afraid to give up something. They'll sell a doughnut, they'll sell pies and they'll sell cookies. Harry's took just one category and said they were going to be the best in bread, and they are.

"What's great about it," he added, "is that all of the success factors we looked at for Leading Edge operations, they don't do. They don't have the animation. You don't see the bread being baked. You don't see the flour. They are able to break the conventions."

During the past year, the 6-year-old company relocated its bakery facility from its unit in Alpharetta, Ga., to a facility four times as large, some 55,000 square feet. This, and two other new facilities, one for prepared foods and one for produce, are operating at 30% to 40% of capacity, company President Harry Blazer said in January.

The bakery offerings at Harry's Marietta unit begin at the start of the traffic pattern in the warehouse-style store, with a counter offering individual items for adults, and a separate counter just for kids, built at kids' level. Every item in the case, which is decorated with dolls from Sesame Street, is 25 cents. Just the type of low-priced offering that serves as a way to keep a child happy throughout the shopping trip, Stern said.

To get to the heart of the bakery department, shoppers must wind along a forced traffic pattern past the produce, meat and seafood department to the double bakery aisle. Later in the trip shoppers can find several feet of dessert items merchandised along with prepared foods.

In the bakery section, there is extensive sampling and signs that have found imitators in supermarkets across the country. The signs feature the breads themselves shellacked and mounted on the signboard along with text describing the name of the bread along with extensive product information.

In addition to the bread, the retailer offers signature cookies and muffins, and what Stern calls "spectacular" cream pies. The breads are made at a central baking facility, which Harry's opened in the past year. The retailer also operates two stores in the Atlanta area called Harry's in a Hurry, which features takeout fare.

Executives at Harry's, which went public just over a year ago, declined to be interviewed by SN.

Harry's Leading Edges

Innovation. Breaks rules of product mix.

Freshness. Breads baked daily; sold that day.

Quality. Top-quality ingredients.