Supermarkets can grab a major portion of the emerging home-meal replacement business, but they'll have to change strategies and management styles to do so, according to a food consultant who has advised Japanese supermarkets and department stores on HMR for the past 15 years.
Tak Kataoka, who has worked with Kintetsu department stores, Daiei Super Markets and Suntory Ltd., is currently writing a book on HMR, and says successful supermarket HMR programs must focus on providing food that is simple, healthy, convenient, safe and, most importantly, tasty.
Kataoka, who built a sushi takeout into a multi-unit franchise operation, thinks HMR growth will mirror what happened in Japan. Twenty years ago, sushi was a $1 billion business there; today, restaurants account for $1 billion while an additional $1 billion is rung up in supermarket and department store outlets.
But retailers who offer too many meals options, specialize in gourmet foods or in foods that are ready-to-eat immediately are on the wrong track, he says.
"HMR food should be at its peak when consumers eat it at home, not when it is served in the store," said Kataoka through an interpreter. Foods, especially hot foods, sold from the traditional supermarket deli are at their peak of taste as they are prepared or when displayed in the case, he says.
Developing foods that reach their optimum flavor when consumers are ready to eat them won't be the job of retailers alone, he said. Manufacturers, distributors, packagers and food technologists will have to develop systems that can achieve the goal of better-flavored HMR items.
And hiring well-known chefs to develop HMR programs won't solve the good taste problem, he says. "Chefs can cook great meals, but they serve those meals in a restaurant to customers who eat the meals immediately after they are prepared. Supermarkets will have to face a new responsibility, he says.
"Supermarkets in the past haven't been responsible for the taste of the products they sell. With HMR, they must develop repeat customers, so they must be responsible for the taste of the products they serve."
The foods must also be basic, and perhaps retailers should focus on only one item.
"If you can sell $10,000 a month in one item, then that's a key item. Supermarkets in the United States should work on establishing one great item; instead, they're going in the opposite direction," he says.
"If you have many items and some are not tasty, customers who buy them won't come back, so you must establish one good, tasty item. Once you've developed a reputation for good-tasting, quality food, you can build on it by introducing other items."
Kataoka offered an example of success built on single-item sales in Japan. One supermarket has established a 6-foot wide kiosk that sells only pork cutlets prepared by a traditional Japanese method. The kiosks ring up about $50,000 per month just in cutlets.
Supermarket executives will have to spend more time at stores to make certain these programs are being developed and run properly. "You can't figure this out from your office; you can't run this business from your desk," he says. The burgeoning HMR business promises to be the most significant turning point for supermarkets since the development of self-service, he says. Trying to manage that business from the executive office will be disastrous.
Philosophically, Kataoka says U.S. supermarkets will need to develop something the Japanese call meal culture.
"The main purpose should be to better American eating habits, and to promote American meal culture. In Japan, we use this term very often, because eating is a reflection of culture itself. But there is very little notion of meal culture in this country." It's the job of supermarkets to do this, he says, but instead they've focused on gross profits.
And the closest thing in the United States to a meal-culture provider? Kataoka says the only one he's seen is in Dallas: Eatzi's.
