Convenience Stores Elevated Fresh Foods Sales Success Crushing Blow for Grocery Deli’s

 

At the intersection of growth fresh food sales specifically Ready-2-Eat and Heat-N-Eat prepared food the convenience store sector is simply trouncing the grocery store sector.  In fact, Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® stated, grocery stores should be embarrassed by the way the convenience store sector and garnered share of stomach by simply focusing on the eating habits of our evolving consumer.”

As the Grocerant Guru®, I've always championed the grocery store deli as a delicious and convenient option for busy shoppers. But let's face the facts, folks – convenience stores are giving the grocery store deli a run for their money. On top of that restaurant takeout food growth is simply another point of market share capitulation by grocery stores.  

Here's the skinny: Convenience store foodservice sales are booming, with prepared foods making up a whopping 33.9% of their in-store gross profits. That's a bigger slice of the pie than grocery store delis can claim these days.

Why the shift? Convenience stores are winning on three fronts:

1.        Speed and Simplicity: They excel at grab-and-go options. Think hot dogs rolling on a warmer, pre-made salads, and single-serve beverages – perfect for time-pressed customers.

2.        Value for Money: Convenience stores often undercut grocery stores on price, especially for prepared food items. Their lower labor costs and focus on pre-made options allow them to offer competitive pricing.

3.        Adapting to Trends: Convenience stores are constantly innovating. They're offering healthier options like fruit cups and yogurt parfaits alongside classic favorites. Plus, many feature hot food options that rival fast food joints.

But fret not, grocery stores are still too large to just fade away! They still have the upper hand in several areas:

1.        Variety: Grocery store delis offer a wider selection, with options to cater to different dietary needs and preferences. From gourmet cheeses to organic salads, we can provide a more customized experience.

2.        Quality: We can often boast fresher ingredients and higher quality preparation compared to convenience stores that rely heavily on pre-made items.

3.        Synergy with Grocery Shopping: The deli is a natural pitstop during a grocery shopping trip. Customers can grab a meal to go while picking up groceries for the week.

Want to Build a Larger

SHARE OF STOMACH

Focus on Today's Customers

Not Yesterday's Wall Street Metrics 

Here's a few ways that grocery stores could bounce back: They need to up their deli game! Focus in on:

1.        Fresh, Appealing Displays: Make delis look vibrant and appetizing.

2.        Shorter Wait Times: Streamline service to compete with the speedy nature of convenience stores.

3.        Innovative Offerings: Feature unique, chef-inspired dishes that can't be found at the corner store.

4.        Highlighting Quality: Showcase the fresh ingredients and culinary expertise that goes into deli offerings.

By combining the customer focused touchpoints including; convenience, price, and quality the grocery store deli can reclaim a place as a destination for grab-and-go meals. It's time to make the deli aisle a destination, not an afterthought.

Are you looking for a new partnership to drive sales? Are you ready for some fresh ideations? Do your food marketing tactics look more like yesterday than tomorrow?  Visit GrocerantGuru.com for more information or contact: Steve@FoodserviceSolutions.us Remember success does leave clues and we just may have the clue you need to propel your continued success.

Once Again Fresh Food Focus Pays Off as Busy Consumers Embrace C-Store Eats

 

Time-starved consumers are increasingly turning to convenience stores for their prepared food needs, according to new research I've been digging into. This is a major win for the c-store industry, which has invested heavily in recent years to develop high-quality, fresh food offerings.

The 2024 Convenience Store News Realities of the Aisle Study, surveying over 1,500 frequent c-store shoppers, paints a clear picture while edifying the findings of Steven Johnson our Grocerant Guru® and his time at Tacoma, WA base Foodservice Solutions®.  Let’s take a look:

1.        Prepared Food Takes a Leap: A whopping 69% of those surveyed reported buying prepared food at a convenience store in the past month, a significant jump of 14 percentage points from the previous year. This highlights a growing consumer preference for convenient, grab-and-go meal options.

2.        Pizza Takes the Crown: When it comes to specific cravings, pizza now reigns supreme as the most popular prepared food item at c-stores. Hot dogs, breakfast sandwiches (dethroned from last year's top spot), deli sandwiches, and hot snacks like French fries round out the top five. Interestingly, hot snacks saw a significant climb from number eight to number five in just a year.

3.        Combo Cravings: The study also revealed that 90% of prepared food buyers purchase additional items to complete their meal. Fountain drinks, bottled/canned sodas, bottled water, coffee/tea, and packaged salty snacks are the most popular pairings. Notably, Generation Z leans towards bottled water (51%) with their prepared food, while millennials favor salty snacks (33%).

These findings are a testament to the success of convenience stores in adapting to the evolving needs of today's busy consumers. By offering a wider variety of fresh, high-quality prepared foods alongside complementary beverages and snacks, c-stores are positioning themselves as a one-stop shop for quick and convenient meal solutions.

As the Grocerant Guru®, I delight when others edify our previous findings. I continue to be excited to see how this trend continues to develop and how c-stores further refine their prepared food offerings to cater to even more specific consumer preferences.  Stay tuned I will bring your more! 

Don’t over reach. Are you ready for some fresh ideations? Do your food marketing ideations look more like yesterday than tomorrow? Interested in learning how Foodservice Solutions® can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit us on our social media sites by clicking the following links: Facebook,  LinkedIn, or Twitter

Red Lobster's Short-Term Gain from lease-buybacks Results in Long-Term Pain

 

Hedge fund Heaven, take the money and run! While making a presentation the other day Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® was asked if he knew what “Hedge fund Heaven was”, he answered from my mind-eye its, take the money and run. Johnson noted consumers want meals, meal components, fresh, fast, and flavorful.  They do not know or care who owns or does not own buildings.

The stability of the brand comes from consistent brand messaging, pricing, menus that evolve, and a constant focus on the consumer.  In the case of Red Lobster, Short-Term Gain vs. Long-Term Burden: The sale of the real estate might have provided a one-time cash infusion for Red Lobster, but it likely came at the cost of higher long-term expenses through the lease payments. Now consider this:

 

1.       Higher Lease Costs: When Red Lobster sold its properties, they then have to lease them back from the new owner. These leases are typically set at a rate that generates a profit for the real estate owner, meaning Red Lobster's rent most likely is higher than the cost of owning the property themselves. This translates to ongoing increased operational costs.

2.       Loss of Equity and Appreciation: By selling the real estate, Red Lobster gave up the potential for appreciation in property value. If the real estate market booms, they won't benefit. Additionally, they lose the ability to leverage the property as collateral for future loans.

Do you Want a 

Larger Share of Stomach?

There can be some advantages to sale-leaseback deals, such as freeing up capital for other uses. However, in Red Lobster's case, the ongoing lease payments seem to be a burden on their finances. This financial strain makes it harder for them to invest in improvements or marketing that could attract more customers.  Here's are additional points to consider:

3.       Rising Costs: The restaurant industry has seen increases in food and labor costs, squeezing Red Lobster's profits [Restaurant Business Online].

4.       Shifting Consumer Preferences: Diners may be looking for more casual and trendy seafood options, or different dining experiences altogether [Restaurant Business Online].

5.       Promotional Misfire: Red Lobster's 2023 all-you-can-eat shrimp promotion backfired, leading to higher-than-expected costs and an $11 million loss [Restaurant Business Online].

6.       Ownership Uncertainty: Thai Union, the current owner, announced plans to sell Red Lobster in January 2024, which can create instability and discourage investment [Seafood Source]

7.       Competition: The casual dining space is crowded, and Red Lobster may be struggling to keep up with fresher concepts or more targeted menus.

Larger Share of Stomach

Requires More Points of Distribution

There is some hope. Here are some ways Red Lobster could overcome these challenges:

1.        Menu Innovation: Update the menu with more exciting and affordable options that cater to current trends.

2.        Focus on Experience: Enhance the overall dining experience with a focus on atmosphere, service, or unique offerings.

3.        Targeted Marketing: Attract new customers with targeted promotions and loyalty programs.

4.        Delivery and Takeout: Expand delivery and takeout options to cater to the growing demand for convenience.

5.        New Ownership: Finding a new owner who can invest in revitalizing the brand could be a big help.

Whether Red Lobster can fully recover remains to be seen, but by addressing these issues, they can take steps to attract customers back and improve their financial health.

Invite Foodservice Solutions® to complete a Grocerant ScoreCard, or for product positioning or placement assistance, or call our Grocerant Guru®.  Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869

The Grocerant Guru: Unveiling the Efficiency Engine of the Future - The Rise of Grocerants

 

Steven Johnson is the Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  He has spent years dissecting the ever-evolving food industry landscape. Today, he wants to delve into a niche that's not only thriving but fundamentally transforming how we source, prepare, and consume food: the grocerant niche.

For the uninitiated, grocerants are establishments including Convenience stores, Grocery Service-Deli’s, Restaurants offering Takeout, and other outlets that seamlessly blend meals or meal components for takeout.

Imagine browsing fresh produce, then strolling over to have a chef whip up a custom salad using those same ingredients or picking up different meal components fresh prepared that are either Ready-2-Eat or simply Heat-N-Eat that can be bundled into a personalized, customized, fresh, fast, family meal. That's the grocerant magic!

But grocerants are more than just culinary convenience. Behind the scenes, they're a symphony of operational efficiency. Let's dissect the key elements driving this change:

1.        Reduced Waste: Grocerants have a direct line from farm to table, minimizing spoilage that plagues traditional restaurants. Think about it: leftover ingredients from the grocery side can be creatively incorporated into restaurant dishes, and vice versa.

2.        Inventory Optimization: Grocerants leverage real-time sales data to optimize inventory across both grocery and restaurant sections. This reduces the risk of overstocking and ensures fresh ingredients are always available.

3.        Labor Streamlining: Cross-trained staff can seamlessly switch between stocking shelves and fulfilling restaurant orders. This flexibility optimizes labor allocation and reduces operational costs.

4.        Data-Driven Decisions: Grocerants use data analytics to understand customer preferences and buying habits. This allows them to tailor product offerings and promotions, further enhancing efficiency and profitability.

The grocerant revolution isn't just about bean counting; it's about offering a superior customer experience. Imagine whipping up a gourmet meal at home using top-quality meal components you just picked out or had delivered from some of your family’s favorite food retailers, or grabbing a restaurant-quality meal or meal component without the wait. That's the grocerant promise.

As the Grocerant Guru®, I'm witnessing a paradigm shift. Grocerants are the future, and their operational efficiency is the engine driving this transformation. So, buckle up, foodies! The grocerant era is upon us, and it's bringing a wave of delicious efficiency! Eat fresher, prepare meals faster, empower every meal at home to be a happy meal.

For international corporate presentations, regional chain presentations, educational forums, or keynotes contact: Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions.  His extensive experience as a multi-unit restaurant operator, consultant, brand / product positioning expert, and public speaking will leave success clues for all. For more information visit GrocerantGuru.com, FoodserviceSolutions.US or call 1-253-759-7869

Portillo’s Building Restaurants and a Brand with Lifelong Customers

 

At the intersection of building new restaurants and expanding your brands reach there are few chain restaurants that are doing a better job than Portillo’s according to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

Johnson says, “Building a restaurant brand that can last a lifetime, requires a building a brand message that can evolve with your customers lifetime. Simultaneously building new restaurants while expanding your brand message is an art crafted on proactive positive consistent messaging.” Here are some ideas how it can be done and a look at Portillo’s.

Create a Positive Memorable Experience:

1.        Themed Menu: Go beyond basic entrees. Craft a menu with a fun, prom-night theme. Name dishes after popular movies, classic dances (The "Electric Slide" Sliders, "The Waltz" White Chocolate Mousse), or even inside jokes amongst teenagers.

2.        Presentation is Key: Plate the food in an elegant yet playful way. Think miniature desserts, colorful garnishes, or creative plating designs.

3.        Photo Opportunity: Designate a photo-worthy corner or have props available for prom-goers to capture their special night at your restaurant. Offer a discount for tagging your restaurant on social media.

Build Relationships:

4.        Personalize the Experience: Train staff to greet couples by name and offer a celebratory toast.

5.        Prom Night Package: Offer a package deal that includes a pre-fixe menu, photo booth access, and a small gift (like a personalized candy box or discount voucher).

6.        Social Media Engagement: Run a contest where prom-goers who post pictures with your restaurant hashtag get entered to win a prize (free meal, gift certificate, etc.).

Long-Term Strategy:

7.        Collect Information: Offer a discount or enter them into a drawing for future dining experiences in exchange for their email addresses.

8.        Targeted Marketing: Use the collected email addresses to send personalized birthday or anniversary promotions, reminding them of their special Prom Night experience.

9.        Loyalty Program: Consider a loyalty program that rewards repeat customers, especially those who come back for other special occasions.

10.     Bonus Tip: Partner with local businesses like florists or limousine services to offer bundled prom night packages.

By creating a memorable prom night experience and building relationships with young adults, your restaurant can turn them into lifelong customers.

Building a Lifelong Customers

Requires Understanding your Customers 

And your Competitors 

Now let’s look at how Portillo’s, the fast-casual restaurant concept known for its menu of unrivaled Chicago-style-street food, wants to officially invite customers to prom. Fans of Italian Beef and dancefloor DJ sets can celebrate the end of the school year, prom and Portillo’s (or “Promtillo’s,” naturally) with a special pre-prom dinner deal for two, a promposal sweepstakes, and special catering options – including the opportunity to book the famed Beef Bus to serve up Chicago-style goodness at the final dance of the season.

Available for a limited time starting April 9, high schoolers nationwide can party with Portillo’s – Windy City-style – with the following Promtillo’s specials:

·         Pre-Prom Dinner at Portillo’s: Bring your date (or friend) to any Portillo’s location and order the “Promtillo’s Meal for Two,” which includes a choice of two Italian Beef sandwiches or two hot dogs, two large fries, one jumbo cheese sauce and a Cake Shake to share.

·         After-Party Catering: Make your after-party iconic with a spread that will keep the party going all night long. The “Promtillo’s Party Package” includes hot dogs, chicken tenders with your choice of sauces, fries, cheese sauce and whole chocolate cake. Prom-goers can also try Portillo’s newest sensation, the Cheese Sauce Fountain, and dip the night away on and off the dancefloor!

·         Roll into Prom with the Beef Bus: Spice up your prom night with a delicious twist – the ultimate party on wheels that brings the iconic flavors of Portillo’s right to your prom venue!

·         Portillo’s Promposal Sweepstakes: Portillo’s wants to see your promposal creativity and be a part of your special night! Upload your promposal photos for a chance to win a Portillo’s catered after party for your friends and Portillo’s merch for you and your date.

“For more than 60 years, our Chicago-style staples have filled the homes, hearts and stomachs of our fans celebrating a birthday, graduation, wedding and more,” says Nick Scarpino, Portillo’s CMO. “As we embark on another 60, we’re adding prom night to the list of iconic moments we get to help celebrate, and we can’t wait to help high schoolers have a night they’ll remember for the rest of their lives.”

Foodservice Solutions® specializes in outsourced business development. We can help you identify, quantify and qualify additional food retail segment opportunities or a new menu product segment and brand and menu integration strategy.  Foodservice Solutions® of Tacoma WA is the global leader in the Grocerant niche visit us on our social media sites by clicking one of the following links: Facebook,  LinkedIn, or Twitter