THANKSGIVING FEAST

ROSEANNE HARPER

Holiday-dinner sales are expected to climb again this year as satisfied customers come back and retailers turn up the heat under product quality.

Without exception, the deli executives SN interviewed said they expect substantial -- even double-digit -- increases in sales of Thanksgiving dinners.

Retailers are picking from a cornucopia of proactive ideas to assure that the sales increases roll in. The ideas include:

Going back to scratch-cooked meals, or at least scratch-cooked side dishes, to gain an edge on quality in an increasingly competitive category.

Breaking earlier with holiday dinner promotions and advertising.

Putting more emphasis on side dishes, which can boost margins and give consumers the flexibility needed to build custom meals.

Designing and executing new in-store point-of-sale materials.

Sampling and creating events that offer a preview of holiday dinners.

Retailers said they also are making operational changes, such as starting to plan earlier and centralizing some of their production to minimize confusion at the stores during the busy Thanksgiving week.

But whatever individual changes they're making in the details of their programs, retailers agreed that product quality is the key this year.

In fact, most said they're stepping back from the "price game" this season to underscore the quality, value and signature characteristics of their holiday dinners.

They also said they're being careful to set a retail price that gives them a decent margin. That's a reversal from this time a year ago when retailers were talking of pursuing ways to compete more sharply on price.

"We made a decision to not compete on price," said Dan Kallesen, bakery/deli director, at 38-unit Harps Food Stores, Springdale, Ark. "The whole idea is to make money. So we decided this year to 'classy' up our dinners a little bit and make the margin we want.

"We're trying to deliver a quality dinner. We know it has to be excellent -- and hopefully exciting -- because we want repeat customers. We've added interesting items like pecan cobbler and sweet-potato souffles," he said.

"We've refined our program each year, making it a more complete dinner. For example, now we offer a rolls and a pie and sweet-potato souffle," said Tom DeVries, director of food service at 25-unit D&W Food Centers, Grand Rapids, Mich.

DeVries echoed many other retailers when he said, "Our customers are our best advertising" for holiday meals from the deli.

"We've had double-digit increases every year since we started the program four years ago," he said, "and we expect that kind of increase again this year. Customers keep coming back."

In a bid to set itself apart from the competition this year, B&R Stores, Lincoln, Neb., has gone back to preparing everything from scratch this year, including the turkey. Last year, the 11-unit retailer used precooked turkeys and components sourced frozen from outside.

And like other retailers interviewed, B&R has decided it needs to get out of the price game in order the push the quality of their holiday meals, said a corporate source at the retailer who asked not to be identified.

The price of B&R's basic turkey dinner this year is $5 higher than last year, "but we expect to have more sales this year because of the quality of the product," the source said.

"With all the emphasis on home-meal replacement right now, customers are looking for homemade products. We're even making mashed potatoes from scratch this year, and we decided to just offer the basic turkey dinner -- no other varieties or sizes -- so we could focus our attention on the quality of it," the B&R source said.

Quillin's, a nine-unit independent in La Crosse, Wis., is also emphasizing the value of making meal components in-store

"We're making all the stuffing in each store this year," said Nancy Rand, deli coordinator at the company. "It's such an important part of the Thanksgiving meal and it does make a difference in taste if you don't make it too far ahead of time." Last year, the retailer made stuffing at one location and delivered it to its other stores.

Operators are also paying closer attention to what customers want in side dishes. They said they are offering more choices and refocusing on the taste profiles.

Rice Food Markets, Houston, has switched from steamed vegetables to grilled vegetables in the dinner programs at its six Rice Epicurean Markets "because that's what's popular -- we think that's what customers want," said Douglas Dick, director of deli and bakery operations.

Hughes Family Markets, Irwindale, Calif., is replacing the green bean side dish it offered last time with a broccoli, cheese and rice casserole, "because it has a better taste profile," said Joe Rodriguez, service deli director at the 56-unit chain.

In the name of quality, retailers who previously had sourced side dishes from outside have returned to making their own.

"Now that we have a central kitchen, we'll have more of our sides from there," said Tim Kean, deli-bakery-seafood merchandiser, at eight-unit Pay Less Supermarkets, Anderson, Ind.

"For example, we've been bringing in a rice, cheese and broccoli casserole -- and we'll still offer that -- but this year we'll also have our own which we think is of superior quality."

Kallesen at Harps is shooting for a double-digit increase in dinner sales dollars this year by adding a variety of side dishes to the one basic turkey dinner offered.

"We brought the dinner varieties themselves down to one. Last year, we had three sizes of dinner packages, but this year we'll do a lot of suggestive selling for add-ons to that one dinner," Kallesen explained.

The turkey dinner package will consist of a 10-pound turkey and basic accoutrements such as stuffing, gravy and rolls. But the spotlight will be on the high-margin side dishes that can be added onto the dinner order, Kallesen said.

"If you just offer turkey dinner packages A and B and C, customers will buy one and leave. But this way we get to do more suggestive selling."

Rice will be giving lot of attention to side dishes as the moneymakers in its program this year, said Dick.

"The sides put the money on the bottom line. Last year, we could have sold more if we had them ready. We'll use a large section of self-service cases -- at least eight feet -- for sides in quarts and pints," Dick said.

The sides, made from scratch, are being produced this year in a central kitchen instead of at store level as they were last year, he added.

Ingles Markets, Black Mountain, N.C., hopes to make choosing side dishes easier for customers this year, said Phil Grasso, vice president of deli/food service at the 188-unit chain.

A single price for all side dishes is part of the customer-convenience plan. Displayed in 16-ounce-size containers, they're all retailing for $1.99.

He expects at least a 10% increase over last year's sales, which had risen 10% over the previous year:

Side dishes are in such demand at D&W that the retailer is no longer offering cents-off coupons for its family-sized, 2-pound portions as it has done in previous years, DeVries said. Coupons for as much as 75 cents off had been offered, but the redemption rate was low.

"The side dishes sell extremely well. We don't need the coupons to drive sales," DeVries said.

While the flurry of holiday-meal activity is aimed at squeezing the best sales through a quick window, retailers also told SN that the program is becoming increasingly important for longer-term sales as well.

"More people [than usual] are interested in prepared food during the holidays because they need a helping hand when entertaining or preparing large family meals," said Ruth Kinzey, corporate communications manager at 135-unit Harris Teeter, Charlotte, N.C. "We find that customers who haven't tried our prepared foods opt to try them [during the holidays]. Then, we hope they'll continue to buy some of these items on future trips to our stores."

That would be a reason to give thanks year-round.