Progressive Grocer Independent

APR 2016

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April 2016 | Defining the Independent Market | 19 ings are in line with the store's overall vision, mission and demographic makeup. Once the oferings have been determined, keep the menu signage simple to entice the customer, and design it to ft the store's overall theme or look. Next, lay out the department to make it conducive for both employees and customers to function in. Te workfow for employees should be ef- fcient so they easily move from prepa- ration to the sales area. Te customer experience also is vital — the menu should be in an easy-to-read place, the ordering station should be accessible, and utensils easy to fnd. "Design for mis en place [putting in place]," Pel- lerin advised. Also, any equipment you purchase should ofer versatility and fexibility. One piece of equipment should have multiple purposes and be used to pre- pare a variety of items. For example, a smoothie bar can easily transition into a tapas/wine bar. Te fourth critical factor is mer- chandising and the cross-utilization of ingredients. Retailers need to plan for both product integrity and theater. Since most departments prepare food in front of customers, retailers need to be aware of the aromas being gener- ated at the same time to ensure the result is pleasant to shoppers. And last, retailers have to ensure they have the correct talent in place. Front-line personnel have to be knowledge- able about the food and willing to talk about it. Retailers might want to consider putting the pre- pared foods department employees in diferent uniforms to distinguish them from other staf, Pellerin suggested. Finding talent can also be a thorny issue, FMI's Stein admits. In a lot of cases, grocers turn to the restaurant in- dustry or recruit from culinary schools to fnd the chefs they need. Te ability to interact with people is often not hard to fnd among job applicants. "Foodies typically like talk- ing about it," Stein says. "People that have the culinary skill often have those people skills needed. What they don't have is the fnancial acumen. Tey don't understand the business of the busi- ness." In other words, it can be difcult to teach them about proft margins and balancing popularity with pricing. Create an Experience Once those fve critical factors have been addressed, retailers need to turn their attention to creating an enjoyable shopping experience. "Tere is a direct relationship between the ambiance of a foodservice area and loyalty to that banner," Stein says. Te ambiance of the prepared food area infuences the customer experience and afects how the shopper thinks of the retailer as a whole. A benefcial perception also can translate to more sales and attract loyal shoppers. More than 30 percent of fresh-prepared shoppers have a difer- ent primary chain for their prepared food purchases than for their grocery purchases, DuBois said. Converting these customers into primary grocery shoppers can grow sales exponentially. Further, those shopping fresh prepared departments spend three-quarters of their prepared-food dollars at their primary fresh-prepared store. "Fresh prepared departments can be huge drivers of trafc," DuBois noted. On average, shoppers spend $7 in the fresh prepared department and will spend $47 on other items in the store, according to IRI. Fresh prepared is currently seeing substantial growth, but will it contin- ue? Stein predicts that in the next fve years, the department will continue to grow at twice the rate of the total perimeter departments. Te industry will also see "those supermarkets that really move needle" set themselves apart from the rest, supermarkets will continue to refne concepts for greater sophistication, and more smaller-for- mat stores will get into the game. "Get involved or get left behind," DuBois asserted. "It's all about sepa- rating from competitors. Set big goals, because the growth is fast." PGI "There is a revolution happening in food retail. The core of that revolution is fresh prepared foods." —Chris DuBois, IRI Source: IRI Fresh Prepared Popular, Growing Nationwide % Growth Sales +15% 9-12% 6-8% 5-7% <5% 16.8% $1.1B 12.1% $1.2B 8.6% $857.5M 9.2% $2.1B 6.5% $893.7M 12.1% $1.4B 8.1% $1.2B 7.3% $2.2B

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