LEES CAFE TO TIE IN GROCERY ITEMS

Lucia Moses

WESTPORT, Mass. -- Lees Market here hopes its soon-to-open, in-store cafe will do more than perk up sales through hot and cold drink purchases. The retailer hopes it'll stimulate Center Store sales, too.

Drinks sold at the sit-down cafe, expected to open in May, will be merchandised at the cafe in retail versions, said Albert Lees, owner of the single-store retailer.

Among them will be Ghirardelli chocolate products, bottled Tazo tea, coffee and biscotti that customers can take home. "If they like the white chocolate mocha syrup," Lees said, "they can also buy it." The cafe will feature regional products like Del's Lemonade of Rhode Island, too.

The take-home packages will be displayed on wire Metro shelving that Lees also uses for specialty products elsewhere in the store. In most cases, these will be secondary displays of existing stockkeeping units. If a product sells well enough there, the cafe could wind up being their only placement, Lees said.

Lees had hoped to strike a licensing agreement with Starbucks, which had opened more than 800 licensed coffee and specialty products stores in supermarkets as of 2003, including Giant Eagle, Meijer and Super Targets.

"I contacted Starbucks three times, and nobody returned my calls," he said. "So I decided to do it myself."

Lees Market is used to doing things its own way. Ten years ago, it tried doing away with its circular to discourage cherry-pickers. It's one of the first independents to develop a customer purchasing database, which the store uses to identify its best customers and slot them in three spending tiers.

The retailer has catered to its upscale customers in other ways, recently expanding specialty foods and moving them from the middle to the front of the store.

The cafe will have a "funky, colorful" decor, Lees said. It will occupy about 400 square feet in the front of the 54,000-square-foot store, near the antipasto bar, cheese and rotisserie chicken. In the past, that area has been for specialty foods, videos and kid activity centers.

"When we want to create some excitement or experiment with a new category, we'll kick it off in that area," Lees said. "If this works out, this will stay permanent."

Lees said he expected 80% of drink sales to be takeaway, 20% sit-down. He hadn't projected the amount of retail sales the cafe would generate.