Delhaize To Launch Grab-n-Go Concept

MATTHEW ENIS

BRUSSELS — The Delhaize Group will launch a grab-and-go home meal solutions concept called “On the Go Bistro” early next year, through a Philadelphia-based commissary operation that will service all of Delhaize Group's U.S. retailers, according to statements made by the company's senior executives during recent investors' meetings here.

“In reaction to changing consumer lifestyles in the U.S. — and thanks to our success in fresh meals in Europe — we believe that a significant engine of growth in the U.S. exists in home meal solutions,” Pierre-Olivier Beckers, president and chief executive officer of the Delhaize Group, said during the company's third-quarter earnings call last month.

“The U.S. consumer's tastes are getting more and more sophisticated, yet consumers lack the time to cook at home. Therefore, in order to address this demand, from early 2008, Delhaize Group plans to introduce in all of its U.S. companies a brand which we will call On the Go Bistro, a new private-label brand, which will be for chilled, prepared meals focusing on great taste and quality.”

Delhaize's U.S. supermarket operations include the Food Lion, Bloom, Bottom Dollar Food, Harvey's, Hannaford Bros. and Sweetbay banners.

The meals commissary will be operated through an exclusive private-label relationship with Hot Cuisine, a division of European produce and convenience food distributor Univeg, and long-standing partner of Delhaize in Europe. Hot Cuisine, which got its start supplying meal components to restaurants almost 20 years ago, currently provides Delhaize's European stores with a line of all-natural, preservative-free, ready-to-eat meals, many of which were developed in collaboration with Michelin-starred chefs such as Pierre Wynants, Wout Bru and Yves Mattagne.

“We will work on an exclusive basis with one of our long-standing Belgian partners, building on the experience and cooperation that made the Belgian home meal replacement program such a success,” Beckers said. “Quality, taste and flexibility in serving size and recipes will distinguish this private label from our competitors.”

Noting that home meal replacement is one of three primary areas where Food Lion anticipates growth — with health and wellness products and private label being the other two — Rick Anicetti, CEO of Food Lion, expressed enthusiasm about the upcoming program as well during the company's Investor Day webcast.

“Home meal solutions — restaurant-quality food — is something that has been a hallmark of the Belgian operation, and it's been a hallmark of the cooperation between Delhaize Belgium and a company known as Hot Cuisine,” Anicetti said.

“What we've done is we've developed an exclusive relationship with Hot Cuisine in the U.S. … We think [On the Go Bistro] will be a very, very unique offering, exclusive to ourselves, that we don't see in the U.S. currently — a restaurant-quality choice that can be found in the convenience of a supermarket.”

Grab-and-go foods, as well as supermarket prepared food departments more generally, have been enjoying significant growth in recent years, as retailers have focused on improving the quality, consistency and convenience of their in-store programs.

However, Delhaize's On the Go Bistro might face a challenge convincing shoppers that food made off-site is just as good as food prepared in-store, said Ron Paul, president of the Chicago-based restaurant consultancy Technomic. Paul noted that many successful European concepts, such as upscale packaged sandwiches sold at chains such as Pret A Manger, haven't translated as well as expected in the U.S. market.

“Commissaries, from a pure production point of view, obviously have a lot of efficiency advantages, and maybe at the point of delivery, the quality is equal,” Paul said. “But, if the consumer doesn't feel that there's a kitchen in the back or a chef preparing the food, it doesn't have that same image.”

However, he noted that the model did merit one promising comparison. “Everyone is watching Tesco right now,” he said, “and they're using an off-site commissary concept as well.”