GOING GA-GA FOR GOURMET

LUCIA MOSES, with additional reporting by CAREY POLIS

NEW YORK - Beverages with unusual flavors, all-natural pet snacks and frozen puff pastries were among the products on retailers' shopping lists at the 52nd Summer Fancy Food Show here last week.

Bill Hogan, general manager of Dave's Marketplace in Warwick, R.I., a conventional retailer with a focus on specialty, was on the lookout for sauces, dairy items and frozen finger foods at the show, an annual bazaar of ethnic, gourmet, natural and other specialty foods. "Prepared food - that's a major focus right now. The product is phenomenal."

Calvin Mayne, chief operating officer of upscale, three-unit Dorothy Lane Market in Dayton, Ohio, sought out traditionally made foods like cheeses and oils, as well as ethnic condiments.

"People travel a lot, and they want to have the same experience" when eating at home, he said.

As conventional retailers make a bigger push into specialty food, having a robust ethnic and gourmet assortment is essential not only to picking off specialty stores' sales, but defending against one's peers.

Three-store Stauffers of Kissel Hill in Lititz, Pa., had that in mind while looking for items to broaden its specialty tea, coffee, candy and baked goods assortments. The chain also sought out products for a store it plans to open in spring 2008 to replace its Rohrerstown unit. At 68,000 square feet, the remodeled store will be much larger and have a greater ethnic and specialty assortment than Stauffers' existing stores, said Warren Crills, grocery buyer for the chain.

From Adina's organic lime-mint juice drink to Sahale Snacks' cayenne pepper- and balsamic vinegar-flavored natural nuts, offbeat flavors and natural, healthy ingredients were common themes at the show. Specialty beverage abounded, like O Beverages' no sugar, ultra-purified water in fruit flavors such as Lemon Lime and Wild Berry, and Stick Tea's tea leaf-filled stick that doubles as a stirrer and tea holder.

Many of these items aren't cheap, but retailers said price doesn't seem to deter their customers, whether they're buying treats for themselves or their pets.

"It's not a money issue," Hogan said. "Who'd have imagined they're spending $7, $8, $9 on a jar of pasta sauce?"

People are willing to spend more on products that are good for them, said Whole Foods Market grocery buyer Vince Swidersk, noting that more low-income consumers are shopping his stores.

Crills noted that specialty isn't recession-proof, though. With gas prices starting to hit consumers in the wallet, he said he was increasingly aware of the need to find products that weren't too expensive.