Thursday, May 26, 2022

Grocerants Replacing Restaurants and Grocery Stores for Dinner


What’s for Dinner is the age-old question every parent hears, and most say I don’t know.  Today more and more families or looking online, or for new avenues of fresh food distributions in the way of meals and meal components that can be mixed and matched into perfect family meal.  

Alternative fresh food outlets with fresh prepared meal components and whole meals that can be bundled in 2022 is a big thing according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®. 

It is at the intersection of a grocery deli, c-store, and restaurant that these new points of fresh food you find convenient locations and ample free parking, they’re adding stylish destination dining spots, cool enough to convince customers to come for milk and paper towels and stay for dinner.

A mash-up of two words, grocerant has broad meaning. According to Steven Johnson, a hospitality-industry consultant who calls himself the Grocerant Guru®, it can be any grocery store, convenience store, retailer or restaurant that offers freshly prepared or ready-to-heat food to eat on the premises, or to-go for time-starved consumers. Think self-branded concepts at supermarkets and even the glitzy glamour of food emporiums like Eataly.

Even the food industry near dinosaur Phil Lempert, stated, “For years, the trend went the other way, with restaurants taking business out of supermarkets,”

Lempert continued, “The focus is moving to higher-margin prepared and ready-to-eat meals. Like it or not, people still have to go to the grocery store, and now they see people sitting around having a glass of wine and a nice meal.”

Johnson went on to say, “Lampert and ilk grocery niche professionals would like to see that but it just is not so. In the last 15 years 50% of legacy grocery stores have closed.  Consumers are moving on. They are driving the adoption of grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food as in the form of meal components and bundled meals.”

In 2018, industry consulting firm Technomic flagged the supermarket threat, noting that the unique consumer-focused traits that restaurants have long relied on are no longer inviolate. “Traditional retail and innovative foodservice alternatives will take share by diminishing the restaurant advantage of enjoyable experiences, quality and convenience.” In addition to supermarkets, Technomic says that meal kits, subscription services, food trucks, dark kitchens and gen-next vending also stand ready to chip away at restaurant profits.

There is no doubt that the last few decades were marked by a near obsession over restaurants, doesn’t mean that euphoria will last forever. What is clear according to Johnson is consumers are still time starved and do not want to cook from scratch like their parents and grand parents did.

Even Aaron Allen of global food consultancy Aaron Allen & Associates, stated, “Restaurants have to find ways to respond to these so-called grocerants,” says. It’s not, however, going to be by selling groceries, he adds. “They don’t have the space or experience to compete that way. Fortunately, they have lots of other things to offer.”

This is key as Allen advises against worrying too much about what supermarkets are up to. “Look at your value proposition through the lens of those it serves and then examine every element of your business – the training, technology, food, marketing, pricing and service. That’s where you’ll find ways to win.”

Know what customers expect from you, Devoting restaurant space to packaged foods might seem like a good idea, but it can be tricky. One Off Hospitality partner Paul Kahan says that Publican Quality Meats, a hybrid butcher shop and cafe in Chicago, has a handful of grocery-type items, such as olive oil, wine, spices and condiments. “We’ve scaled back a bit,” he says. “People come for meats and charcuteries from the butcher shop, bread from the bakery or they’re here for the restaurant. They’re not really here to get packaged foods, and a lot of it just sat there.”

“It has evolved since we opened,” says James Murphy, one of the restaurant’s owners. “Customers would ask where they could get some of the products we use in the restaurant, so we stock some authentic foods from Ireland. It’s a part of our brand and works nicely for what we do, but it’s not really a profit center.”

Once again planning is everything, don’t overlook seasonal opportunities, such as picnic fare in the summer and takeout side dishes during the holidays, to enhance business. Monitoring hotel promotions is a good place to start, especially innovative spots like the Peninsula Hotel in Beverly Hills, California.

The hotel has found success with its PenAir program – airline-ready meals for guests to take aboard flights. And because the hotel caters to every whim and need, it fields phone orders for pick-up meals.

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

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