CAFE BREAK

ROSEANNE HARPER

PROVIDENCE, R.I. -- Eastside Marketplace here is looking to scoop the competition with an aggressive entry into food service.

The main feature is a food court with seating in an adjacent area called The Good News Cafe. The library-themed cafe, complete with a rack of international newspapers and bookshelves, leads off a fresh meals power aisle presentation that includes expanded service, added product variety and open production in every department.

The 41-seat cafe has a coffee bar serving trendy cappuccinos and lattes. The remainder of the food court, hugging the right wall of the store, consists of a hot-food counter with a $3.99 special of the day, hot pizza, a custom sandwich program, fresh-squeezed juices, fresh popcorn, and chilled, prepared foods sold by the pound.

Here's the story: Officials at Eastside saw competition mounting from restaurants and fast-food establishments in the area and knew that long-term survival depended on getting into the meals business themselves, said Edmund Pacheco, general manager for the single-unit retailer. Then, two years of research that involved looking at other stores across the United States, polling customers and taste-testing recipes, preceded the official change last September.

"We knew we wanted to do this, but we didn't have enough space. We didn't have a kitchen. Until we expanded and remodeled, we were just a typical grocery store with a typical deli and that wasn't conducive to growth," said Pacheco.

"What we've done is get ready for the millennium. We've taken everything up a step so we can give our customers what they're looking for," he added.

The company expanded the store from 26,000 square feet to 34,000 square feet, but most notable is a big increase in the selling area. By reconfiguring as well as adding footage, the company increased total selling space in the store from 16,500 square feet to 27,000 square feet.

Since the official unveiling at a grand re-opening last fall, the payoff has been quick. The power aisle itself has chalked up impressive sales, but the new direction has apparently been a draw for the whole store.

Total customer count and sales both have climbed 25% to 28% and deli, prepared foods and other fresh departments have all seen a sales increase of at least 30%, Pacheco said.

But it didn't just happen because of the new image, Pacheco pointed out. The success comes from a tremendous amount of research and trial and error.

"First we traveled all over to look at what other supermarkets were doing. We borrowed some ideas, but we made sure they were right for our particular store and location before we put them into effect. We brought them back and analyzed them and checked them out with our customers," he said.

The company brought several focus groups together. Some were made up of Eastside Marketplace customers and some were made up of consumers in the area who had never shopped the store. Others included consumers from outside Eastside's market area, Pacheco said.

A trip to Austin, Texas, to see Whole Foods Market's stores bred the idea in his mind for having a cafe, Pacheco said.

"We were in those [Whole Foods] stores on the weekend, and there were more people in the cafes than there were in all the rest of the store. That's when I became convinced we needed a cafe," he added.

"We have a lot of students as customers and we have a lot of senior citizens, too, so we were pretty sure the cafe would go over well," Pacheco said.

Like Austin, Providence is a university town. Indeed, Eastside Marketplace is situated practically on the campuses of Brown University and the Rhode Island School of Design.

"Off-campus housing for Brown starts less than a block away and we're just two and a half blocks from Wayland Square where the students hang out. Of course, we have a lot of competition for their business right there. I don't know where you would find a tighter concentration of specialty food shops and restaurants," Pacheco said.

The competition is a mix of big branded chain outlets and sharp local operaters. "There's a Subway and a KFC, but they don't seem to be as busy as the others," Pacheco noted. "There's a place called Jeff's that makes sandwiches. You go in there and they're putting on a show. It's not just buying a sandwich; it's watching it being made. That one's very popular.

"There's also Starbucks and all kinds of other coffee shops and restaurants. You name it and it's there. Oriental, Thai, anything you want," Pacheco said.

In addition to the cafe concept, something else he saw in his travels around the United States struck Pacheco as a sure winner -- heat-sealed packaging.

"We liked the container they're using at Ukrop's and Star Market's store in Allston [Mass.]," he said.

"That's such a great, great package. I'm happy I went with it. It can be heated in either a conventional oven or a microwave and also you don't have a leakage problem. Customers seem to love it. We knew we wanted that. We got hand sealers like Star uses at the service counter," Pacheco said.

Next on the agenda was to get custom-printed tops for the packages, he added.

"We started out with their [the manufacturer's] stock covers and that's worked out well because they have dark green on them and our colors are hunter green and cream and burgundy. Our tables in the cafe have dark green tops. Everything is color-coordinated. There are square umbrellas over the tables with our colors and logo," he said.

The new packaging has been a particular boon since the company has expanded its menu dramatically, Pacheco said.

Prior to the re-do, the store offered only fried chicken and fish and chips in the deli. By now, two chefs -- both hired more than a year ago -- have developed recipes for more than 250 products that are rotated, Pacheco said.

But besides the added variety, it's the whole look that helps sell prepared foods, he added.

The cafe is visible from outside. People can be seen sipping cappuccinos as they read the newspaper. Others are seen digging into the day's special, but the look is warm and comfortable.

"The cafe might look a little like Barnes & Noble or Starbucks, but more upscale. There are fresh flowers on every table," Pacheco said. He added that the hot-food counter, in combination with the coffee bar and the other elements of the cafe and food court, speaks of ready-to-eat food.

"The whole presentation tells people we're in the meals business," Pacheco said.

As customers enter the store, they first see the floral department; then, they are gently herded to the right.

"It's not a forced traffic pattern, but a lighted canopy with our logo brings people's attention to the cafe and that side of the store," he said.

They also see a large rack just in front of the canopy that holds newspapers from across the country and around the world and a large selection of magazines.

"We have a student body here that's from all over the world and also people who have homes in Florida and other parts of the country. So you'll see newspapers from London and Paris and Naples, Fla., on our rack. If a customer requests a newspaper from just about anywhere, we'll get it for him," Pacheco said.

The cafe seating is to the right, against the window. First in line on the right side of the power aisle is the hot-food counter, next comes the pizza station and then a custom-made sandwich station. A selection of beverages, including fresh-squeezed juice, is next. Then comes the bakery. The produce, seafood and meat departments follow.

Open production and well-thought-out signs help tell the meals story, Pacheco said.

"Our signs are a big part of the whole setup -- a lot of chalkboard. They're a little like what you see in Fresh Fields. We spent nearly a year developing them and we were working on them right up to the eleventh hour, on the day of the re-opening. We took such care with them because they all tell the customer something important," he said.

"For example, they tell them our coffee beans are delivered every day within 24 hours of being roasted and our seafood is brought in from day boats. That means it's sourced from companies that send their boats out and bring them back the same day. It's truly fresh product," Pacheco said.

On open production, he said, "We wanted to bring the customer into the back room. Everything is visible now. It's very important to have that customer-associate contact," he said.

It creates warmth, it emphasizes service and the freshness of the products, and it fosters constant input from customers, Pacheco explained.

"We have some customers who are very vocal and that's good. We'll keep listening to them and changing things to give them what they want," he said.

Already one daily special has been switched from a teriyaki entree to meatloaf in order to provide customers with another "traditional" entree.

The week's complete-meal specials now are: Monday, steak teriyaki; Tuesday, chicken and peas; Wednesday, country pork ribs; Thursday, meatloaf; Friday, fish and chips; Saturday, steak with mushrooms and onions; and Sunday, turkey. The hands-down favorite is fish and chips, and the nearly neck-and-neck runners-up are turkey and meatloaf.

"We easily sell 100 of the fish and chips dinners on Friday," Pacheco said. Some of the chilled entrees and side dishes offered by the pound are chicken cutlets at $7.99; Asian pork tenderloin, $8.29; turkey loaf, $5.29; stuffed peppers, $4.29; baked macaroni and cheese, $4.29; and broccoli with roasted garlic, $4.59. Variety is a top concern of customers when it comes to prepared foods, Eastside learned from focus groups.

"What we found was they weren't so concerned about whether we offered the food hot or chilled, but whether there were enough choices," Pacheco said.

He added that sales of prepared foods are about evenly divided between those eaten in the cafe and those taken out. Any item in the chilled case can be heated so customers can eat it in the cafe if they want to, Pacheco said.

While the new focus is decidedly on food service, Pacheco stressed that the company is not losing sight of the fact that it's a supermarket. Indeed, it took care to set up grocery aisles in the same pattern they were before the remodel so customers could find products easily, he said.

"We just want to be known as the supermarket that gives customers more choices, some of the things they've been asking for more and more," Pacheco said.