THE FULL-MEAL DEAL

David Merrefield

No one would want a steady diet of it, but every now and then it's not bad to reflect on weighty matters such as this question: What is really at the core of the business and what are we actually doing?

For instance, suppose you're in the telephone business: Should the core business be considered the stringing of wires along poles, or should the activity be premised on providing services that make possible personal communication by voice?

Then, suppose you're in the periodical publishing business: Should the core of the business be considered the printing and distribution of sheets of paper, or should the business be considered one of information gathering and propagation?

Finally, suppose you're in the food-retailing business: Should the core of the business be defined as the selling of food components that consumers take home for assembly into meals, or should the focus be on the fact that consumers are ultimately interested in having finished meals sitting on the dinner table? In each instance, of course, the second selection is better because it's the broadest definition of the business activity. A broad definition is superior because it enables one to perceive when changes in technology or consumer demand, or both, are mandating fundamental changes in the way business is done.

To pick up on the examples earlier mentioned: · An executive of a telephone company who realizes that interpersonal voice communication is what defines the business would be quick to recognize the importance of cellular technology and be ready to think about giving up wires. · A publishing executive who realizes that information propagation is what the business is all about would be quick to see the importance of changes ranging from fax machines to electronic bulletin-board systems. · Similarly, a food-retailing executive who realizes that consumers don't necessarily come to the supermarket to obtain cans and boxes, but are really interested in obtaining an end-product -- meals -- would be quick to recognize the growing importance of what might be called "meal in a minute" stores. The concept of ultra-convenient, finished-meal stores is one that isn't entirely new, but it's one that seems to be suddenly on the move.

Among those now tinkering with the minute-meal store is none less than Wal-Mart Stores, which recently unveiled plans for in-store experimentation with the Harry's in a Hurry concept. That store style was developed by Harry's Farmers Market, Atlanta, and is little more than a small, limited-line convenience outlet specializing in fresh-prepared meals, and extras, for at-home consumption. Wal-Mart plans to try four of the little Harry's units (about 1,400 square feet) at the front end of its discount stores to see how they work out. One securities analyst expects each of the Harry's installations to do $1.5 million to $2 million in annual sales. A Page 1 news article on the joint venture appeared in SN Nov. 14. Meanwhile, Sutton Place Gourmet, Rockville, Md., will soon roll out a similar concept, Sutton On the Run. The company plans to start with a 1,200-square-foot prototype, adding up to seven more if all goes well. A news article about the Sutton strategy is on Page 19 of this issue. Finally -- and to get to the central point -- many conventional supermarkets are in the lead when it comes to discovering ways to quickly deliver prepared meals to busy shoppers, as is to be expected. To cite one of many examples that might be mentioned, Ukrop's Super Markets, Richmond, Va., operates Fresh Express, a 5,000-square-foot unit that offers lunch and other meal items. The store also provides seating.

Also, and of perhaps more long-term importance, conventional Ukrop's stores also offer prepared foods, some under the "Dinner for Two" takeout program. Ukrop's programs were mentioned in a Page 1 news feature in the Nov. 7 issue. All this shows once again that the supermarket industry isn't one to sit by quietly when the serious business of preparing for the future is at hand. And, it makes it possible to predict with some margin of safety that supermarkets will succeed even if a fundamental shift in product styles occurs.