Profit’s Drive Convergence of Grocery and Restaurants Concepts

Americans have deemed Ready-2-Eat and Heat-N-Eat fresh prepared food “better for you” according to Foodservice Solutions® Grocerant Guru™ Steven Johnson.  Leading grocers continue to separate from a pack legacy grocers with unique fresh prepared Ready-2-Eat and Heat-N-Eat food.

Why?  It quite simple according to the Grocerant Guru™ it is the next step in the evolution of food retailing you might say it is the “future” of fresh food retailing.  In new research by BCG/SMG/Barkley on Millennials found:

Simply put  this with the fact that more adults are eating “take out” at home,  or as Foodservice Solutions® previous reporting found Eating-In while Eating-Out and there is definitely an opportunity.  Millennials are driving change in the retail marketplace. 

Packaged Facts, a division of MarketResearch.com, points to prepared foods as an important part of “The Future of Food Retailing in the U.S.,” finding that “Sales of prepared and ready-to-eat foods were expected to grow 7.5 percent in 2012, according to the research group.

Two keys to prepared-food growth in supermarkets, according to Packaged Facts:

1.       Such selections draw traffic and ring up sales.

2.       Higher gross margins (just under 45 percent compared with center store’s 21 percent) prove their value.

Companies the ilk of Whole Foods, Hy-Vee, Wegmans, Central Market Fresh & Easy to name but a few are entering the Grocerant niche while garnering a cult like following. 

I fact Whole Foods is exploring layouts that are more food court than retail space for its flagship store. As highlighted by NewHope360 and CultureMap Austin, the renderings further cafe-ize the shopping experience with stations and bar seating (Pictured above).

As regular readers of this blog know we have often discussed that Hy-Vee will open Market Grille restaurants in 75 remodeled locations over the next three years.  Each of the sit-down-style restaurants will feature a full bar, extensive wine lists and a menu with everything from breakfast to steak dinners.

In addition, Hy-Vee is creating more casual experiences titled Market Cafes. These cafes will still have a bar and table service and aim to offer a unique experience. The convergence is the space where retailers are closing the gap as grocery retailers are beginning to approach their prepared foods section as a restaurant and restaurants are developing a foodservice strategy. Are you ready for some Outside Eyes?

Visit: www.FoodserviceSolutions.us  If you are interested in learning how Foodservice Solutions 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization contact us via Email Steve@FoodserviceSolutions.us  or visit Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant

Fresh Food Facts 2014 Mid-Year Sales Drivers

Foodservice Solutions® Grocerant Guru™ has compiled some mid-year food facts you should know.  While the growth of Ready-2-Eat and Heat-N-Eat fresh food continues to drive top line growth and bottom line profits in every retail food sector today. Here are some facts that will help you understand why:

Half (52%) of the best-selling better-for-you new foods/drinks introduced in 2013 carried a less/reduced calories/sugar-free claim, followed by high fiber/multigrain (42%), natural/organic (39%), real fruit (36%) and touted added nutrients (22%), per IRI.

In 2014, 34% of shoppers purchased organic or natural meats, explains the Food Marketing Institute, Arlington, Va.

One-quarter (27%) of consumers are looking to organic foods and beverages to avoid genetically modified organisms, per Packaged Fact’s “2013 Non-GMO Foods;” 19% of consumers are very concerned about GMOs.

Half (51%) of adults think a lot about the healthfulness of their food, however 80% made some effort to eat healthier in 2013 and 34% made a lot of effort, explains IFIC.

In 2013, 50% made an effort to avoid sodium/salt and/or high-fructose corn syrup, 49% trans fat, 48% saturated fat, 43% MSG, 42% artificial colors/dyes, 42% growth hormones, 40% saccharin and 36% refined sugar, according to Hartman Group’s “2013 Reimagining health & Nutrition.”

According to Technomic’s “2013 Breakfast Consumer Trend Report,” 66% eat breakfast at home on weekdays, 27% bring breakfast from home to eat en route, 25% eat breakfast at work and 11% of kids bring breakfast to school.

Snacking frequency continues to increase across all dayparts with 18% of adults snacking in the early morning, 37% in the morning, 68% in the afternoon, 62% in the evening and 46% in the late evening, reports IRI.

The “2014 New Product Pacesetters” report, put together by Chicago-based Information Resources, Inc. (IRI), says that eight in 10 of the best-selling new foods and drinks launched in 2013 touted a distinctive/new flavor claim followed by ready-to-use/on-the-go (52%), bite-sized/hand-held (41%), easy/microwave prep (39%), kid-targeted (23%) and a different texture claim (21%).

Convenience, better-for-you, premium/indulgent and multicultural/global interests continue to drive growth in the refrigerated and frozen foodssector. Taste has a great impact on 90% of food and beverage purchases followed by price (73%), healthfulness (71%, up 9% vs. 2013), convenience (51%, down 5%) and sustainability (38%, down 20% vs. 2011), according to the “2014 Food & Health Survey,” produced by the International Food Information Council Foundation (IFIC), Washington, D.C.

The Specialty Foods Association, New York, reported that 74% (or 225 million consumers) purchased gourmet foods last year—60% for everyday meals and 36% for snacks.

Nearly half (46%) of all adult eating occasions are alone; 35% of these involve a more upscale culinary experience. Hartman Group also observed that when adults eat alone, they’re more likely to opt for fresh vs. frozen meals.

Children are eating alone more frequently kid-specific products are a timely trend. A report called “2014 Kids Food and Beverage Market,” by Packaged Facts, Rockville, Md., projects the U.S. kid-specific market to grow from $32 billion to $41 billion by 2018.

According to Technomic’s ATKearney “2014 Fresh Prepared Foods” report, growth in fresh prepared foods is projected to outpace retail grocery and foodservice through 2017.

 U.S. convenience stores reached record in-store sales in 2013,  Among the in-store categories, foodservice drove profits, accounting for 28.9% of gross profit dollars.

Simply put  all the facts edify the growth of the Grocerant niche and point to the biggest change in American eating and food preparation habits is the move to convenient, Ready-2-Eat and Heat-N-Eat  fresh prepared food aka the Grocerant niche.

Success does leave clues the  growing demand for greater personal participation in meal preparation and food assembly is driving demand for pre-prepped/fully-cooked meats, meal kits, take-and-bake and oven-ready items and assemble-at-home desserts.

Today cooking from scratch included assembly of fresh prepared items in fact Over half (56%) of meal preparers made last night’s dinner at home from scratch, followed by 24% prepared pre-packaged foods, 9% nuked frozen/heat-and-serve packaged foods, 6% relied on take-out and 4% ate at a restaurant, according to “2013 Study of Dinner” from New York-based Gallup.

Outside Eyes can help you integrate the undercurrents of an evolving foodservice industry. Contact: www.FoodserviceSolutions.us Steve@FoodserviceSolutions.us or call 253-759-7869 

Rite Aid Getting ‘Better for You’ with new Concept store.

Food retail may never be the same.  This week Rite Aid showed off its latest concept of wellness retailing, unveiling a remodeled store that is says is it’s store of the future.  Yes, the stores has updates that include larger departments for pharmacy that include private consulting rooms and over the counter medicines but it the fresh food that Foodservice Solutions® Grocerant Guru™ thinks is ground breaking for the chain. 

 Rite Aid has added a café and patio area, serving coffee, tea, baked goods, sandwiches and ice cream. Following the industry leading success of Duane Reade ( a division of Walgreens) and Walgreens subsequent success launching fresh prepared food in select stores around the country.

The café will complement Rite Aids focus on ‘better for you’ food such as gluten-free and organic foods. Rite Aid President and Chief Operating Officer Ken Martindale  stated “"The Beverly Hills store is a great example of how we are aggressively evolving the Wellness store format to identify concepts that perform well and can be broadly applied to future remodels and test new concepts, like our Fresh Day Café,” … the ultimate goal of delivering a more personal and engaging customer experience."  

Plans are for another 450 Wellness stores set for conversion by the end of fiscal 2015. The company has 4,600 stores in 31 states. If all 4,600 store eventually ad fresh prepared Ready-2-Eat and Heat-N-Eat fresh food and a café this will contribute to ongoing retail food industry disruption. 

Invite Foodservice Solutions® to complete a Migration Marketing assessment, grocerant program assessment. No other foodservice research or marketing company has focused on the Grocerant niche since 1991.  For brand, product placement, menu positioning assistance simply call Foodservice Solutions® 1-253-759-7869 or visit: www.FoodserviceSolutions.us .

Starbucks' Hand Crafted Success

Food merchant extraordinaire Howard Schultz CEO of Starbucks has done a better job expanding the Starbucks brand in new and non-traditional avenues of distribution than any other food retailer. Schultz has done that while driving top line growth and bottom line profits within existing units. 

Complementing its mainstay brand attribute of hand crafted yet leveraging differentiation Starbucks has rolled out handcrafted sodas. “Baristas will brew the sodas in stores using a Starbucks-branded "Fizzio" machine, which the company bills as a "breakthrough in carbonation technology." According to Josh Fine, Starbucks brand manager for Fizzio

Currently the sodas will be available in 16 states, including Virginia, Georgia, Florida, Mississippi, Louisiana, North Carolina, South Carolina, Hawaii and parts of California

Starting with three decaffeinated flavors Spiced Root Beer, Golden Ginger Ale, and Lemon Ale customers will be pleased.  Uniquely Starbucks Fizzio is able to carbonate a flavored beverage. This ensures that "every ingredient in the beverage receives the same level of carbonation and maximum flavor," according Josh Fine.

Success does leave clues and here are some from Starbucks:

1.       In the week leading up to Christmas Starbucks sold $ 2 Million Gift cards a day.

2.       Starbucks spends more money on employee health care than on coffee beans every year.

3.       20% of Starbucks customers visit a store 16 times a month that’s Loyalty

4.       Starbucks is now using 6 billion paper cups a year.

5.       Starbucks platform of choice offered 87,000 possible drink combinations and that was before hand crafted soda’s

6.       Starbucks plans to add 1,000 new store in China alone this year.

7.    Starbucks has grown an average of 2 stores a day over the last 27 years.

Visit www.FoodserviceSolutions.us  or http://www.linkedin.com/in/grocerant or twitter.com/grocerant 

Steven Johnson is Grocerant Guru at Tacoma, WA based Foodservice Solutions, with extensive experience as a multi-unit operator, consultant and brand/product positioning. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche.  253-759-7869

Amazon Continues Disruption Growth Hacking Meal Delivery

Dinner at your doorstep Seattle Spotlight a new meal delivery fresh food service from Amazon will clearly be disruptive. Foodservice Solutions® Grocerant Guru™ regular updates on this blog about Amazon Seattle Spotlight may be coming to an end.

Seattle technology information service Geek Wire verified that Amazon the “Seattle giant is quietly moving into the takeout business. Amazon is launching a food takeout service as part of Amazon Local beginning in Seattle and will compete with companies like GrubHub and DeliveryHero.”

It is unclear if the service will be named Seattle Spotlight now that the test seems to be over, well almost over.  As GeekWire reported that the “new service was available in the Amazon Local iPhone app earlier this week, but was disabled Wednesday due to a bug.”

Amazon has delivered groceries for a long time and has been testing Amazon Spotlight for about 18 months. Launching fresh prepared Ready-2-Eat food for delivery via mobile phone places Amazon directly in the center of the fastest growing retail food sector the Grocerant Niche.  

An Amazon spokesperson told TechCrunch that the new fresh food delivery service may follow a similar slow rollout testing more in Seattle before launching in additional cities.

Here is how Rebekah Denn reported that Amazon via “Seattle Spotlight” “ is offering  a “blend of takeout and home cooking, ranging from opening a ready-to-heat container of Pike Place Chowder to grilling your own Skillet burger patty and frying your own fries.”

Restaurants contract with Amazon to sell, cook and delivery preapproved menu items. That my friends is disruptive. Denn went on to explain in detail how it works and she was impressed that Amazon “with the selection, but not too surprised by it once I heard that Jonathan Hunt, formerly of Boom Noodle and Lowell-Hunt Catering, is the chef in charge of the Seattle-only program”….

How do restaurants figure out how to deconstruct their dishes for a home cook to prepare, or to package them for delivery so they're still good to eat? In La Spiga's case, I've found it fairly idiot-proof to grill my prosciutto piadina (part of an $11.95 box lunch) at home to melt the cheese. The Samurai Noodle ramen has also come with straightforward directions, taking a few minutes to boil the noodles, warm the broth and pork, and add the pre-sliced toppings.

"We thought it was a neat way to offer better service without... the extra expense of opening a restaurant," said La Spiga co-owner Sabrina Tinsley.

Working with Hunt, "we selected items we thought would travel well. We did a series of experiments, obviously, to make sure they would get there the same way," she said. Soup, for instance, "was a bit of a challenge" on a jostling ride. Baked pastas held up better than boiled noodles.

I asked how the salad, one of my old La Spiga favorites, arrived so crisp and fresh despite what I assumed was a day's delay. "I try to have my staff be really careful about the way they cut it. If you're just slamming the knife down on it it's going to bruise it and brown and deterioriate faster," Tinsley said.

It’s not clear what types of restaurants Amazon has partner with, today how they differentiate in a crowded market will be key to success as companies the ilk of

Postmates, Caviar and Eat24already deliver in Seattle along with a plethora of independent restaurants and most national chains.

Visit: www.FoodserviceSolutions.us  if you are interested in learning how Foodservice Solutions 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization or you can learn more at Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant contact: Steve@FoodserviceSolutions.us

When are Your Customers Are Ready-2-Eat?

Where are your customers going to get dinner? 64% of American consumers are unsure about what’s for dinner at 4 PM every day and 83% don’t know what’s for dinner at noon. When your customers are just beginning to think about what's for dinner what are you doing?

Eighty-one percent of American consumers are unsure about what's for dinner; the opportunity is yours for the asking. Consumers are looking for high quality ready to eat foods and ready to heat meals. After identifying, qualifying, quantifying the new opportunity, I coined them as Ready-2-Eat and or Heat-N-Eat Grocerant Niche food. . Consumer trends point to this - what today's time starved consumer wants is to purchase meal components that they can bundle into a customized family meal that will please everyone without spending time cooking.

Food is Everywhere

At one time you purchased your food at the grocery store channel blurring has created a platform where food is expected to be everywhere! Consumers today have the opportunity to purchase high quality chef prepared ready-2eat and heat-N-eat food from independent restaurants, grocery stores, chain drugstores (Walgreens) convenience stores, chain restaurants and non-traditional food retailers the ilk of Amazon.com and food trucks. At the convergence of all of these new and legacy meal component points of distribution you find the Grocerant niche.

So What is a Grocerant?

The grocerant niche refers to prepared food that is portable, Ready-2-Eat or Heat-N-Eat food that is deemed "better for you food". The consumers are finding grocerant niche food in grocery store deli sections including Whole foods, Trader Joes, Safeway Lifestyle stores, Central Market and Wegmans Market Café . Not to be left out, convenience store segment has grocerant pioneers in the brand names of Wawa, Sheetz, Rutter's Farm Stores, and 7 Eleven. Finally chain restaurants and independent restaurants around the world complete the circle I call the grocerant niche.

Successful foodservice operators today understand that differentiation in menu items and food products doesn't mean different, rather it means familiar with a twist; taking ordinary daily menu items, adding contemporary relevance. Then presenting, brand positioning and pricing competitively; these are the universal footprints of success found within the grocerant niche.

Like Everything Else Consumers Want Food On Sale.

90 percent of people look for deals to get more value when making food purchases in new national research survey conducted by DiGiorno January 2013.

US consumers estimate that restaurant rewards program would increase their visit rate to a particular restaurant by average of 35%, according to new study; 65% would recommend restaurant more to others if that restaurant offered rewards program in a study by LoyaltyPlus January 2013

US Millennials seem to be spending more money than other generations when it comes to dining out, industry officials noted as reported by Ginia Bellafonte of the New York Times as a percent of income January 2013. Is your company ready for Outside Eyes to drive inside profits? Are you searching for consumer relevant brand positioning?

Visit: www.FoodserviceSolutions.us  If you are interested in learning how Foodservice Solutions 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization contact us via Email Steve@FoodserviceSolutions.us  or visit Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant

Fresh & Easy Evolving Branding with Relevance

Fresh & Easy from the start was positioned as a new kind of market in an evolving marketplace.  Today Fresh & Easy is much better, on target to meet and exceed customer’s needs with new products and customer relevant messaging. 

Retail food companies today must be merchants first but the messaging must elevate the brand while educating the consumers particularly when you are creating a new market niche.  Fresh & Easy originally entered the Ready-2-Eat and Heat-N-Eat fresh prepared grocerant niche with food that did not quite fit with the messaging.  They went to great lengths to correct that and today they are doing a great job at integrated product and brand messaging.

Incorporating consumer relevant messaging like Hand-Picked, Hand-Cut, and Hand-Made, with Time Equals Freshness, Fully Prepared Meals, with Cook-it, Heat-it, or just Eat-it resonate with authentic relevance improving customer relevance.

Mike Evans Fresh & Easy Head of Marketing stated that this new campaign is centered on five “pillars” that differentiate the Fresh & Easy brand from competitors: Affordable organics (including the value priced Wild Oats private brand); “handmade” prepared foods; fresh foods delivered daily; no “unpronounceables” (products with artificial flavors, colors); and a wide range of meal solutions.

Success does leave clues and Foodservice Solutions® Grocerant Guru™ believes Fresh & Easy has picked up all the right clues stating “Non-traditional fresh food retailers are finding tremendous success.  However this new messaging campaign by Fresh & Easy will elevate Grocerant Niche to a new level accelerating the growth or Ready-2-Eat and Heat-N-Eat fresh prepared food.”

Invite Foodservice Solutions® to complete a Migration Marketing assessment, grocerant program assessment. No other foodservice research or marketing company has focused on the Grocerant niche since 1991.  For brand, product placement, menu positioning assistance simply call Foodservice Solutions® 1-253-759-7869 or visit: www.FoodserviceSolutions.us .

Panera’s Future Growth Come’s with an Omni-Channel Focus

Panera Bread CEO Ron Shaich outlined his vision for creating a platform for growth moving forward.  The vision is filled with contemporary consumer relevance. His approach is a macro Omni-Channel strategy with micro customer grouping tactics, leveraging technology, and big data.

Panera is on track with Non-traditional avenues of fresh food distribution including Ready-2-Eat and Heat-N-Eat aka Grocerant Niche food according to Foodservice Solutions® Grocerant Guru™ Steven Johnson.

The goal in the plan dubbed Panera 2.0 is being rollout to “reduce ordering friction” for customers by implementing a variety of ways to order more quickly thus driving top line growth.

Shaich said that Panera had secured a 5-year, $100M term loan to support the Panera 2.0. Shaich went on to say the digital investment is necessary and that it will take time in fact it may be more costly than anticipated as he asked investors to  patient through an expected slowing in earnings growth.

Shaich stated “We need to figure out where the world is going and make sure we’re prepared for it. We have a big ship to move. It can take several years before we get traction,” he said. “We must expand our vehicles for growth.”

There is a lot to look at in Omni-Channel retail today including mobile/online ordering, kiosk ordering and large-scale catering, another “vehicle for growth” In addition “Panera is looking at is small check delivery, which it is already doing in some locations. Shaich said the company began understanding the power of large and small order delivery in 2013, when it began building a “world-class IT function.”…

“I work from home sometimes and there is a Panera two blocks away in every direction. I often ask, do I really want to get in a car, get in line, order and wait? It’s a long process, so I usually end up in the fridge scrounging around for leftovers,” he said. “There are millions of people out there who want Panera but why aren’t we serving them? Shouldn’t we be in the delivery business?” Shaich stated.

Panera 2.0, he added, is a vision to offer more than one service because every customer wants to interact with the brand differently.

“Our goal is to improve Panera’s competitive positioning,” he said. “We are trying to figure out how to bring Panera to you; trying to figure out this small order delivery.”

Panera has developed hubs in its larger markets to help facilitate delivery on both a large (catering) and small-ticket scale. Shaich said the team has to “get the physical aspects” down before they can move forward with the service.

In addition to its no-line 2.0 features and delivery tests, Panera is also “working on” new footprints and opening in hospitals, universities, urban areas and small towns. Non-traditional avenues of fresh food distribution for Ready-2-Eat and Heat-N-Eat aka Grocerant Niche food is driving growth in every sector of food retail today.

Can outside eyes help your company? Foodservcie Solutions® excels with Ready-2-Eat and Heat-N-Eat fresh food for QSR’s, Full Service restaurants, C-stores and Deli’s with a focused on Build, Measure, Learn, and Repeat steps to success program? Visit: www.FoodserviceSolutions.us or Call: 253-759-7869 Success Does Leave Clues 

Foodservice Solutions® Grocerant Guru™ Global Webinar for Seafood Processors & Seafood Retailers Don’t Swim Against the Current 5 Keys to Staying Ahead

Foodservice Solutions® Grocerant Guru™ Steven Johnson will be presenting a webinar for seafoodsource.com Seafood Processors and Seafood Retailers Don’t Swim Against the Current 5 Keys to Staying Ahead.

Traditional Avenues of Distributions are being replaced more and more by Non-traditional retailers and new avenues of distribution each are focusing on fresh prepared food, leveraging portability, packaging to create family meal cohesion and garner market share. 

Who is after your current customers? Do you understand Food Customer Migration Marketing?

SOME LIMITED FREE REGISTRATION STILL AVAILABE

80 percent of retailers know about up-dated industry data, but only 47 percent understand its implications for their business, according to a study by Knowledge Network.

Consumers are dynamic not static.  Seafood processors and Seafood retailers must be mindful of the undercurrents of Customer Migration Marketing. Learn success steps utilized by Non-traditional fresh food retailers to capture a larger Share of Wallet and Share of Stomach. Make sure your product focused not focused on Yesterday’s Consumer but Tomorrows consumer.  Keep your products consumer relevant. 

This webinar will help you answer:

Don’t swim against the current. Join us for this webcast to learn:

·         How consumer demands for more processed and value-added seafood is affecting the industry

·         The hidden costs (and benefits) of value-added processing

·         Best practices for streamlining repack operations and production processes using multiple-output BOMs

·         How to optimize production of by-products to minimize waste and improve profits

·         Why improving distribution with route optimization and fleet management is top of mind with today’s leading seafood executives.

LIMITED FREE REGISTRATION

Reserve you spot now they are filling up fast.   The link for webinar Optimized Production and Distribution: 5 keys to staying ahead:

http://www.seafoodsource.com/en/premium/premium-webinars/26210-optimized-production-and-distribution-5-keys-to-staying-ahead

For international corporate presentations, educational forums, or keynotes contact: Steven Johnson Grocerant Guru™ at Tacoma, WA based www.FoodserviceSolutions.us  His extensive experience as a multi-unit restaurant operator, consultant, brand / product positioning expert and public speaker will leave success clues for all.Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant

A New $100 Million Dollar’s Targeting Restaurant Sector Dinner Day-part

What’s for Dinner may not be Outback, Olive Garden or Red Lobster. This spring while most restaurant companies were battling flat or declining customer counts two meal kit delivery start-up’s raised $50 Million each.  A new $100 Million Dollars targeting share of stomach during the dinner hour once a battle between restaurants and grocery stores where for 30 years the restaurant sector garnered share of stomach regularly. That trend changed in 2005 for the first extended period in 30 years according to the United States Department of Agriculture report on Expenditures for Food from 1976 through 2012.

“The race for share of stomach of dinner day-part is sure to continue to heat up” according to Foodservice Solutions® Grocerant Guru™ Steven Johnson. “The Dinner-Kit-Delivery business is booming fueled with   $100 in new funding for only two companies.” Johnson continued.

With inflows of cash at that level there is no doubt that the Ready-2-Eat and Heat-N-Eat fresh prepared food aka Grocerant Niche food is still in its infancy. “Legacy retailers the ilk of Red Lobster, Applebee’s, Olive Garden, Ruby Tuesday’s, Safeway, Publix, and Kroger all will feel the competitive heat in the kitchen” according to Foodservice Solutions® Grocerant Guru™.

Who got the $50 Million?  In late April the first $ 50 Million dollar round went to Blue Apron.  In early June the second $ 50 Million dollars was received by HelloFresh. Each company is in the Dinner-Meal Kit-Delivery business.  That is where companies ship out packages of fresh ingredients for specific recipes, ready for customers to turn into home-cooked meals thus intensifying competition for legacy retailers.

HelloFresh co-founder Hamish Shephard stated “that the start-up is now profitable in its European markets. The company now ships more than one million meals per month.” That is one million meals not sold in restaurants or from the grocery store.

The Dinner Meal-Kit-Delivery sector is leveraging the popularity of home cooking and the continued migration and adoption of e-commerce. Unlike traditional meal-delivery services, these companies deliver nearly everything needed for a meal — except for the actual kitchen preparation. Its reported that subscribers generally pay $60 to $70 per week for the ingredients to make three meals for two people.

Blue Apron revealed recently that during March, 2014 it delivered 500,000 meals. Wondering where your customers are?   That’s means that Blue Apron is operating with a $60 million revenue run rate. These are not the only players in the space Plated is very similar to both Blue Apron and HelloFresh is garnering lots of attention according to Foodservice Solutions® Grocerant Guru™.  Other’s entering the Meal Delivery business are PeachDish, FreshDirect, and Amazon Spotlight.

Visit: www.FoodserviceSolutions.us  if you are interested in learning how Foodservice Solutions 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization or you can learn more at Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant

Safeway, King Kullen, Publix, and Kroger Stuck in the Middle

Safeway, King Kullen, Publix and Kroger are positioned squarely in the middle of the grocery / supermarket sector in the United States.  That is one place no company can thrive in todays bifurcated marketplace. While each retailer does a good job for what it is doing today.  They may not be enough for it’s not about offerings, operations, or new openings the consumer is dynamic not static the industry is evolving faster than most middle of the road retailers.

Simply put there is no lasting opportunity being stuck in the middle. While each offers Ready-2-Eat and Heat-N-Eat fresh food they are not doing with enough quality differentiation for consumers to notice. On the Legacy CPG side they are simply put Stuck in the Middle.

We don’t need to look far away for examples of what may be on the horizon for these legacy companies that are in quagmire of their own making.  This year middle of the road grocery retailers in Great Britain are experiencing a uniquely challenging environment complicated with unwanted declining sales.

Both Tesco and Morrisons are capitulating market share due to management strategies that put them in the middle of the grocery sector in Great Britain.  Here is what’s bad, they are capitulating share to Lodi and Aldi each known as ‘discounters”.

Nielsen found In the 12 weeks to 24 May 2014 that Aldi and Lidl continued to outperform in the U.K. market with sales increases of 33% and 22% respectively. Along with Waitrose, they are still gaining market share.

In the United States Aldi is no stranger today Aldi has 1,275+ outlets.  They are the fastest growing grocer in the United States. Like the U.K.  Publix has discounted companies the ilk of WinCo and Aldi that continue to garner market share everywhere they open.  WinCo had increased the size, quality, and positioning of its Ready-2-Eat and Heat-N-Eat offering providing additional points of consumer differentiation.

With a bifurcated food marketplace growing even clearer being stuck in the middle is not a good thing.  Companies the ilk of Whole Foods, Wegmans, and Metropolitan Market are positioned opposite Aldi and WinCo and will do fine.   Others will have to migrate from the middle leveraging Grocerant Niche tactics to elevate and educate brand positioning. Should Publix buy Whole Foods and move into Up-Market Fresh Prepared Grocerant Niche ‘Better for You’ food?  Foodservice Solutions® Grocerant Guru™ says ‘What other choice do they have!”

Steven Johnson is Grocerant Guru at Tacoma, WA based www.FoodserviceSolutions.us  with extensive experience as a multi-unit operator, consultant and brand/product positioning. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche Call for more: 253-759-7869

Ready-2-Eat ‘Better for you’ Food Drives Customer Migration

The line between restaurants and food retailers is growing ever thinner. The fight for America's food dollars continues to intensify as consumers find fresh prepared Ready-2-Eat food options at a wide and growing array of outlets across almost every channel: convenience stores, chain drug stores, restaurants, grocery stores, club stores, vending and even more non-food retailers like dollar stores.

Foodservice Solutions® Grocerant Guru says” While manufacturers, retailers and restaurants worry about choice overload, consumers have embraced their new choices and show no signs of returning to the old ways. This fight is taking place in what is called the grocerant niche.”

The restaurant industry is not an industry known for trying to be first as in fastest to market with an ideation, food or technology advance. In the United States the larger the chain in almost all cases the more slowly they are to adopt something than a smaller chain or independent restaurants will. Chain restaurants goal is simple feed one meal at a time in the restaurant while protecting and edifying the brand.

Historically chain restaurant leaders have denied the credibility of start-up competitors as non-relevant. The pizza sector is a great example; evolving from family dinning independents to national chain of "Red Roof" Italian, then to delivery only outlets and now take-N-bake is garnering market share in the pizza sector. (Note: Home Made Pizza Company and Papa Murphy's are further examples of take and bake pizza operators.)

Trends in the Food Industry Point to an Increase in Non-Traditional Meal Occasions

At the intersection of the consumer, fresh prepared food and technology we fine that consumer eating behavior is evolving and is now beyond the control of traditional food marketers. Evolving culture and lifestyle, demographics along with the new uncertain economy are all putting pressure on the American food consumer: Demands of work, economic shrinkage, demands of raising a family, commuting, social interaction, kid's after-school activities, all contribute to a food marketplace where convenience vies with price over legacy brands. Recent advances in food packaging and new points of non-traditional food distribution have empowered consumer choice, and Americans are embracing these choices even as legacy marketers cringe. Who's after restaurant food dollars… simply put… everyone.

Why should you care if Walgreens is selling fresh prepared Ready-2-Eat and Made-2-Order sandwiches? Why should you care if Whole Foods, Trader Joe's, Safeway and Wegmans are selling Ready-2-Eat and or Heat-N-Eat fresh pizza? Why should you care if Coinstar is selling Seattle Best Coffee at 1,000 locations for $1.00?

You should care because they are selling it, and you are not! The fastest growing sector of retail food service for the past five years has been the Convenience store sector. The C-store sectors growth in large part has been driven by fresh prepared food. Non-traditional avenues of distribution are growing, gobbling market share while establishing new patterns of consumption, price points and customer loyalty.

The Shopper is in Control Spurring New Retail Food Formats

Trader Joe's and Whole Foods have created Ready-2-Eat and Heat-N-Eat fresh prepared food items with qualitative differentiation as an entity with identity that has help propel them into Ready-2-Eat fresh prepared food leadership. In fact recent research shows that both Trader Joe's and Whole Foods are each known for high quality (restaurant quality) Ready-2-Eat and Heat-N-Eat foods with distinctive offerings. More important each is leading with innovative products and package size that create value and have positioned each chain as a food shopping destination for meal components customized and personalized for immediate consumption or mix and matched for a meal time at home. In short they are stealing your customers.

Walgreens fresh prepared food is restaurant quality and priced less than Panera Bread or Corner Bakery CAFE. Both Panera Bread and Corner Bakery CAFE thrive in urban locations. Walgreens is now growing price, quality and speed of service advantages over legacy retailers. Legacy restaurant chains must reconsider the speed at which they evolve and adapt or non-traditional outlets will capture profits margins as well.

Traditional views of meals and mealtime can pretty much be discarded. Legacy retailers waiting for the "next big thing" to copy simply might be out of luck this time. Legacy food retailers may not like to be first movers very much but it may prove that waiting too long will not work this time.

Product, Packaging, Placement, Portability and Price are Foodservice Solutions® 5 P’s

The retail food world is evolving at an ever increasing pace filled with innovation in food, portion size, points of distribution, and quality fresh prepared meal solutions. The price, value, service equilibrium is resetting in retail foodservice. In order to edify the brand and reinforce consumer relevance restaurateurs must leverage Foodservice Solutions® 5P's of food marketing. 

Many legacy food retailers continue to practice brand protectionism, stifle the brand while diminishing consumer relevance. The consumer is dynamic not static. Brands must be dynamic, evolving with the consumer. Four more years of watching other retail sectors thrive should be long enough. Success in the restaurant world is no longer simply about what happens within your 4 walls. Get Help Now:

Visit www.FoodserviceSolutions.us  or http://www.linkedin.com/in/grocerant or twitter.com/grocerant 

Steven Johnson is Grocerant Guru at Tacoma, WA based Foodservice Solutions, with extensive experience as a multi-unit operator, consultant and brand/product positioning. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche.  253-759-7869

Restaurants Battling Ambiance of My Office Chair, My Couch, My TV

When fast casual restaurants, quick service restaurants, and full service restaurants don’t provide fast service, distinctive differentiated fresh food, bundled Mix and Match meal components customer counts will decline.

The competitive fresh food landscape is evolving faster than legacy chain restaurants operators have been willing to accept.  With continue flat or down year over year customer counts the restaurant sector is feeling the undercurrents of consumer migration according to Foodservice Solutions® Grocerant Guru™ Steven Johnson. 

There is a “direct correlation between customer frequency of visits, speed of service, price and portability” according to Johnson each directly relating back to Foodservice Solutions® 5 P’s of Food Marketing.

Technomic reported new research that directly supports Foodservice Solutions® findings specifically: 

·         Sixty-four percent of consumers report visiting fast-food restaurants at least weekly, and 40 percent patronize fast casuals as often.

·         Patronage is significantly more frequent at fast-food than at fast-casual concepts; twice as many consumers visit fast-food (39 percent) as fast-casual (19 percent) restaurants more often than once a week.

·         Delivery occasions have increased slightly at LSRs. Further, more than a quarter expect fast-food (30 percent) and fast-casual (28 percent) delivery, while similar proportions say this service could encourage patronage.

Many legacy restaurants have discounted this global trend.  Legacy operators don’t’ understand the undercurrents of fresh prepared food customer’s migration and the scale of success it is finding.  Let’s take a quick look at what is happening. 

Elliot Fread, CEO of Long Island City-based Bimmy’s (a gourmet wholesale catering company) sales “11,000 sandwiches, salads, and other prepared meals to just 44 Walgreens (Duane Reade NYC).  That is 250 meal occasions a day per location that at one time went to restaurants or could be going to a restaurant today. How many meals to you sell a day? 

In the Philippines Chef Claude helped launch three packaged Filipino comfort dishes through the country’s 7-Eleven franchise “that aim to be healthier and better tasting than typical ready-to-eat meals.” That is immediately consumable fresh foods which id & Elevens focus. Emmanuel Lee Esguerra, marketing communications manager of Philippine Seven Corporation, stated: “Although Chef Creations is more expensive than our usual meals, it is market dictated.” He added that it took almost a year to finalize the three meals because Chef Claude wanted to guarantee tasty meals without compromising on ingredients. “Everything was made from scratch; no instant powder was used,”

7 Eleven is clearly focused on customer frequency of visits, speed of service, price and portability and seeking to garner additional restaurant customer migration with Ready-2-Eat and Heat-N-Eat Grocerant niche fresh prepared food. Is you company selling meals to the customer of yesterday or the customer of today?  Are your customer counts increasing?  By the way don’t forget Pinkies Liquor stores are selling fresh in store prepared Ready-2-Eat and Heat-N-Eat food.

Can outside eyes help your company? FoodservcieSolutions® excels with Ready-2-Eat and Heat-N-Eat fresh food for QSR’s, Full Service restaurants, C-stores and Deli’s with a focused Build, Measure, Learn, and Repeat steps to success program? Visit: www.FoodserviceSolutions.us or Call: 253-759-7869 Success Does Leave Clues 

Are C-Store Drive Thru’s the Next Quick Service Restaurant Sector?

Convenience stores with Drive-Thru’s can be found all around the country including Texas, Arizona, and Wisconsin to name but a few locations.  Foodservice Solutions® Grocerant Guru® has documented more options for fresh food with portability within the C-store sector in all 50 States and North America than anyone.  Now as important as portability C-stores are finding success with Drive-Thru’s.

Express Convenience Centers locations with Drive-Thru’s are cutting-edge convenience stores with delicious quick-serve food, fresh coffee, and a variety of groceries and beverages. Express Convenience Centers sell everything that is at the Drive-Thru window as well.

If you are on your way home from work, have the kids in the car  and  need to make a quick stop for milk, a Ready-2-Eat Dinner, or Desert your commute gets better and faster because you never have to get out or your car.  Don’t want to get your Hair messed up on a cold, wet and rainy day? Not to worry no longer a problem just drive up and place your order at the Drive-thru window. Consumers say that is “better for you”.

QSR’s (Quick Service Restaurants / Fast Food) has long thrived selling 60% to 65% of their Ready-2-Eat and Heat-N-Eat fresh food thru the Drive-Thru.  Now drive-thru’s are a stable at Starbucks and companies the ilk of Panera Bread developing new units with Drive-Thru’s.

Foodservice Solutions® Grocerant Guru™ Steven Johnson believes that C-store sector may have a new and growing advantage over legacy chain restaurants. Johnson stated “Convenience stores have brand permission from consumers to bundle mix and match meal options that can be customized into a family meal. At the same time C-stores have the ability to bundle multiple meal periods in one purchase.”

The ability to bundle a gallon of milk, a box of cereal with a hot turkey sandwich and ice cream all to-go in one stop without getting out of the car.  That’s a competitive advantage.  Casey’s General Store you have the added option of delivery which consumers find increasing important.  Thus the incremental brand value from meal component bundling via drive-thru or delivery becomes a real competitive threat to legacy QSR’s.

Visit: www.FoodserviceSolutions.us  if you are interested in learning how Foodservice Solutions 5P’s of Food Marketing can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation and individualization or you can learn more at Facebook.com/Steven Johnson, Linkedin.com/in/grocerant or twitter.com/grocerant