CREAM OF THE COAST

Robert Vosburgh

California -- the Golden Crust State.

From tres leche cakes and bolillo rolls, to "Mountain High Strawberry Pie" and "Fresh at Five" hot French bread, the principal retailers in the Los Angeles basin use in-store bakeries not only to reflect their commitment to a heavily Hispanic customer base, but as a fresh showcase offering variety at competitive prices.

In conjunction with this week's annual convention and exposition of the Retailer's Bakery Association in Anaheim, Calif., SN toured ISBs in select stores in the market.

Of the top five retailers in the region, four belong to national players Albertsons, Kroger Co. and Safeway. Kroger operates both the Ralphs and Food4Less banners in and around Los Angeles, while Safeway is present with its Vons stores. Albertsons is a major player in this market. Stater Bros. rounds out the top five list, and is the only independent operator on it.

According to a recent poll of 3,000 adults conducted by International Demographics, Houston, 43.5% stated they had shopped during the prior week at Ralphs, 31.8% at Albertsons, 28.5% at Vons, 12.9% at Food4Less and 9.4% at Stater Bros.

In-store bakeries are an important component of the retail strategy here, though many stores visited by SN tend to be smaller than 50,000 square feet an, in some cases, included only self-service items. But regardless of size or format, the ISBs reflect national trends on a local level: Branded concepts make a strong statement in this market, particularly Krispy Kreme doughnuts, which were available in Albertsons and Stater Bros. stores; coffee programs, such as Starbucks service counters in Vons and Albertsons; and self-service kiosks offering airpots of Millstone Coffee Co. in Stater Bros. These operators also are keen on featuring at least one signature item in their bakeries, even if they are outsourced or parbaked; the proprietary image is what they're after, they said.

Albertsons #6165

2291 West Malvern Ave. (at Gilbert)

Fullerton, Calif.

This new 59,000-square-foot store -- the primary food anchor in a large shopping center -- is approaching its second anniversary. Measuring just over 1,600 square feet, the ISB footprint is "pretty typical of all our new stores," according to Deanna Melroy, bakery sales manager for the Southern California division. The retailer's ISB efforts define the marketplace in regards to selection and operations.

"We really hang our hat on fresh-baked daily and cycle baking throughout the day," she said. "Every half-hour, there is something in the oven."

Indeed, on the morning of SN's visit, an associate was preparing a rack of hot French bread fresh from the oven. Once bagged, the bread was rolled out while an announcement promoting it echoed throughout the store. According to Melroy, the division's No. 1 ISB seller is guaranteed hot between 4 and 7 p.m. daily. The loaves are made from raw dough, which comprises 70% of Albertsons' bread and roll program. The other 30% is parbaked.

Albertsons bolsters its popular French bread program with an extensive portfolio of artisan breads, some of which are California favorites retained from the retailer's 1999 acquisition of American Stores, including jalapeno cheese, in which bakery associates hand-press sliced peppers into the dough before baking.

"Our approach to marketing is to position our stores as the neighborhood food and drug store of choice in each community we serve," said Melroy.

A 16-foot merchandising table with wings held both the manager's special as well as the Bread of the Month. According to Melroy, the former is a divisional special focused exclusively on core items, while the latter is corporate-driven. Mass displays are encouraged since the featured breads are on ad or an in-store bonus buy, she said. In Southern California, artisan choices include four long breads, nine loaves and two organic artisan breads.

Breads and rolls include Hispanic favorites like bolillo and telara rolls, as well as four organic choices and seven hearty breads. The chain is looking at introducing sliced breakfast breads and a loaf called French toast bread in the near future.

The retailer also runs a successful program called Classic Cakes. At this store, they're smartly displayed in the multi-tier service case fronting a production area that includes a rack oven, mixers and decorating station. Store-produced and custom-decorated seven days a week, cake comes in more than 50 varieties, including one exclusive to the Southern California division. Pink Champagne cake, developed and tested in California's central coast region prior to a divisional rollout in October 2002, is a two-layer white cake filled with rum-flavored custard, covered in whipped topping, and finished with shaved white chocolate dyed pink.

"We take the best practices and products from each division and develop a program around them that allows other divisions the option of bringing them in," Melroy said. "The goal is to do a majority of the production as far back in the supply chain as possible, and reduce in-store labor. We want the associates out here selling, not in the back room with production."

Albertsons makes a big splash with its tres leche cake program, which was developed in this division for corporate use. The creations are made with a vanilla sponge cake soaked in a three milk-style blend, iced with whipped topping, and finished with a variety of decorative covers.

"We have about 20 [tres leche] varieties that are offered in three different sizes," Melroy told SN. "We carry the program in about 35% of our stores, and not just exclusively in Hispanic neighborhoods. It's expanding throughout the division."

Additionally, shoppers will find bolillos and telaras in the bread and roll section; banderas and polvorones in cookies, and "Elephant Ears" in the pastry case. In certain neighborhoods with a higher mix of Hispanic shoppers, the stores offer items like conchas, empenadas, elotes and roscas, she said.

In fact, cakes, rolls and breakfast items get regular, on-ad buy spots every week, including eight-count packages of signature cinnamon rolls, which receive a dedicated four-foot buy spot every week.

Self-service options here range from 12 varieties of New York Style bagels to clam shells of cookies. A cold coffin case merchandises sheet cakes priced to compete directly with club stores: $14.99 for a half-sheet and $9.99 for a quarter-sheet. Inside this case, there are also ice cream and specialty cakes, novelty items, and presliced and national-name cheesecakes.

Stater Bros. #35

1175-C Baker St. (at Fairview)

Costa Mesa, Calif.

This store, remodeled less than a year ago, is one of 70 Stater Bros. stores with a service bakery (out of 156 stores in the chain). Here, the big feature the day of SN's visit was Mountain High Strawberry Pie, a signature item that coincides with early spring and the start of California's strawberry harvest. The pie, store-produced and available all through the spring and summer, "can sell themselves," according to Mickey Gold, vice president, service deli and bakery.

The ISB footprint, to the far right inside the store entrance and adjacent to the deli/fresh meals counter, included an endcap full of pies and a sample station staffed by associates.

These are exciting times for the independent operator, which is busy experimenting with new products in the bakery, and implementing several successful test products. Among the new arrivals are signature premium brownies, individual upscale desserts and the addition of La Brea artisan breads, according to Gold. Most of these items are outsourced, while 99% of the ISB relies on bake-off lines, with only a few mixes for items like cornbread and poundcake, he said.

Besides select loaves from La Brea, the chain also includes several varieties from Il Fornaio, a long-established popular restaurant chain in Southern California that has acquired a reputation for fine breads. At Stater Bros., the loaves are direct-store delivered to this location and the unit in Chino Hills, Calif. There are also six loaves of store-produced bread, as well as six varieties of outsourced organic breads.

The service case includes individual mousse cakes, cheesecakes and tarts from Galaxy Desserts, a San Rafael, Calif., company that already supplies select products to other retailers operating in the state, such as Bristol Farms, Albertsons, Draeger's and Raley's/Bel Air. Here, a two-store test is under way to determine customer appeal. The new Amazing Brownies, DSD fresh from Santa Ana, Calif.-based Balboa Dessert Co., is also getting play at the service case, with a countertop merchandiser devoted to the items. The selection is rounded out with a number of store-decorated cakes, rounds and sheets that are ready for decorating.

Due to customer demographics, the popular appeal of tres leche cakes is not as apparent at this Stater Bros. unit, but Gold said in some stores, up to half of the case can be devoted to them. Typically, up to 35% of a case is tres leche cake, and the chain is pushing the flavor into new markets.

Table merchandising revolves around the four items featured on ad each week, beginning on Wednesday. New tables can expand or shrink according to need, and to maintain the "full-display" look as product is bought during the day.

Stater Bros. has made a big splash with the introduction of Krispy Kreme doughnuts, and this location is no exception. First tested in February 2002, the doughnuts were brought in by Chairman Jack Brown, who saw lines outside of freestanding Krispy Kreme stores and thought the concept could work in supermarkets. Here, a multi-deck, self-service tower sits inside the entrance of the store, where it was recently joined by a self-service Millstone coffee kiosk stocked with airpots of regular, decaffeinated and flavored brews. While the doughnuts are direct-store delivered daily, the coffee is made in the deli as needed. Currently, the Millstone/Krispy Kreme combo stations are in 40 stores, with another 80 due to receive them in the near future.

Vons #2335

2684 N. Tustin St. (at E. Lincoln)

Orange, Calif.

This Safeway-owned Vons store was remodeled in June, 2002 and includes the retailer's new beige and black color scheme. The presence of the in-store bakery was felt just inside the front door, where a four-deck merchandiser featured various-size containers of St. Patrick's Day cookies next to a hot table for rotisserie chicken.

The actual department of the store was in the back right corner, where SN found six tables filled with a variety of products. The first merchandised assorted eight-inch deep-dish pies, including blackberry, apple lattice and Dutch apple. The pies were joined by raspberry cream cheese pudding cake and assorted loaf cakes, both sliced and whole. While there were five items on ad the week of SN's visit, unadvertised specials abounded in the ISB. In this case, the pies were $4.99, but $4.49 with the Vons Club card. Safeway officials declined to participate in SN's market tour.

Table signage and on-pack stickers reminded customers that the retailer runs a nightly special: "French bread hot at 5 p.m. or free." But there was plenty of breakfast items, too. Another table held coffee cake rings at $3.99 each and cinnamon chunky bread at $3.79; there were also four-count packages of muffins, in blueberry, banana nut-flavored and chocolate chip, to name a few.

Other tables were devoted strictly to bread products. There were deli-style sourdough and farm-style sourdough loaves, and 12-count bags of French and ranch rolls. Sizes grew to a 36-count bag of dinner rolls. Cookies and other sweets took up space on a separate merchandiser, with 36-count tubs of chocolate chip, peanut butter or oatmeal raisin, for $4.19; more adult flavors were here, too, in the form of 16-count, jumbo-size variety packs featuring premium flavors like macadamia nut and chocolate macadamia. And besides the dinner rolls, other "club store" value buys included eight-count croissant packs stickered with "Value Pack, Buy Big and Save"; eight-count clamshells of Danish variety for $5.49; and 30-count boxes of chocolate- and vanilla-iced cupcakes for $15.99.

A self-serve counter between the commercial bakery wall and the service case was filled with rolls, fresh doughnuts, croissants, muffins, Danish, petite strudels and an extensive line of bagels, including a unique cranberry walnut variety and a new Veggie bagel, available for a "limited time only."

Artisan breads were merchandised in a walk-around island decorated with wicker baskets for loaves and rounds, and wells for long breads. The top of the merchandiser featured a Safeway Select olive oil display.

The department's service case fronted a busy production area that included full production ovens for bake-off products and a cake decorating station, on which a box of fresh produce was being unloaded for use in pies and cakes. Extensive signage detailing custom cake choices -- cakes, fillings and toppings -- hung prominently over the case, inside of which were pre-assembled choices ranging from fresh fruit-top cheesecake to a chocolate Gran Marnier mousse cake.

Three doors of frozen cakes included blank sheet cakes in a variety of sizes ready for decorating, and private-label ice cream pies and cakes. Next to it, a refrigerated walk-around merchandised individual slices of cake, as well as a unique, heart-shaped cake, chocolate-enrobed with a rose for $5.29.

Ralphs #148

2620 E. Chapman Ave. (at Yorba)

Orange, Calif.

Private label makes a strong showing here at this Kroger-owned Ralphs, with both the Ralphs as well as the premium Kroger Private Selections labels. This chain is known for its smaller stores, and this one is no exception. Size doesn't keep it from offering a full variety of products in a service atmosphere, however.

The bakery, located along the right wall next to the deli, includes a service case and small production area, a five-door freezer case, two primary merchandising tables, and a few smaller setups for seasonal or featured products.

Ralphs officials declined to participate in SN's market tour.

Private label could be found to some degree on almost every product in the ISB, including a new $22.99 cake with a name that's more than a mouthful: the Double-Layer Chocolate Bavarian-Filled Triple Chocolate Indulgence cake. Elsewhere, there were quarter- and half-sheet blanks in both one and two layers, with either butter cream or whipped cream toppings. The cakes in the freezer were supported by extensive signage describing the choices available, and the prices. For example, cake was available in chocolate, white or marble; another sign reminded customers of the variety of fillings available, such as fresh fruit.

A two-layer quarter-sheet cake with butter cream frosting was $15.99, or $16.99 with whipped cream. For half-sheets, serving 40 people, butter cream single-layers went for $25.99, or two-layers for $28.99. Whipped cream-topped cakes were $27.99 for a single layer or $30.99 for two layers. Carrot cake was also available in both quarter- and half-sheets. Private Selection labels are found on varieties of two-layer rounds, including the carrot as well as a red velvet cake.

The service case was staffed by a pair of talkative, friendly associates. Inside the multi-deck case, a variety of pastries and upscale cakes joined service muffins and Danish.

A pair of three-tier, square merchandisers held items ranging from apricot pockets and chocolate mousse cookies to eight-inch pies in flavors like apple lattice, apple crumb and no-sugar-added cherry. The Ralphs label could be found on packages of breakfast items -- 12-pack doughnuts, eight-count cinnamon rolls and a walnut-cinnamon pull-apart.

A bread wall accommodated short and long loaves and rounds that included selections from Ralphs' "International Classics" line of artisan breads. Smaller loaves and individual rolls and bagels were found across the department in a self-service case, adjacent to a two-deck mini-case full of cream cheese and related cold spreads.