A VERY DIFFERENT PICTURE

DALLAS (FNS) -- Very nearly in the literal shadow of gourmet takeout icon Eatzi's, another takeout pioneer is carving out its own niche in this competitive market.But make no mistake: 55-year-old Marty's and its two-year-old Cafe TuGogh concept are far from a carbon copy of Eatzi's, even though they can pull the same demographics and are separated from each other by one block.Among the differences

DALLAS (FNS) -- Very nearly in the literal shadow of gourmet takeout icon Eatzi's, another takeout pioneer is carving out its own niche in this competitive market.

But make no mistake: 55-year-old Marty's and its two-year-old Cafe TuGogh concept are far from a carbon copy of Eatzi's, even though they can pull the same demographics and are separated from each other by one block.

Among the differences found in the 15,000-square-foot Marty's/Cafe TuGogh, for example, is a new 90-seat fine-dining restaurant that features live entertainment four nights a week, plus a wine selection renowned for two generations as the best in Dallas.

Cafe TuGogh's fresh takeout works to complement the restaurant and wine and create what owner and president Larry Shapiro calls "a department store as opposed to a specialty store."

"We approach each concept as a full-service area, and in each one, we're on a par with the best in the city," Shapiro said. "We see ourselves as the Neiman-Marcus of the food and wine business."

That synergy is apparent in the store's circular flow, where customers must walk through Cafe TuGogh, then through the wine aisles before reaching the restaurant.

While Marty's/Cafe TuGogh can't match Eatzi's in atmosphere and customer frenzy, Shapiro says that's not the intent. He noted that "we're striving for a more relaxed environment, where people can get in and out of the store without being jammed elbow-to-elbow" as he's often seen at Eatzi's.

Takeout's importance to Marty's strategy is reflected in Cafe TuGogh's location "front and center."

Three four-shelf, self-service chiller cases fill an alcove just to the left of the entrance. One 12-foot case is divided into 4-foot sections carrying main meals (both complete and components for mix-and-match), sandwiches, and pastas and salads. A second 12-foot case holds a variety of spreads and dips, such as hummus and smoked trout. And at the alcove's end, an 8-foot dessert case sprawls with individually wrapped servings of fruit tarts, cakes, creme brulee and other gourmet treats.

Another alcove holds cases of cheeses, caviar, and fresh, locally made pate.

Passing a case of cold half- and split-bottles of wine ("perfect if you want to start dinner with just a glass of white and finish with a red," said Shapiro), shoppers walk past several short gondolas of gourmet foods, such as fancy olives and chocolates, to reach the cafe's piece de resistance: bulk takeout of more than a dozen salads and pastas, plus by-the-pound entrees and appetizers. About one-quarter are rotated each week.

From this service case, shoppers can buy prepared foods for an entire dinner party; they can also purchase just enough spinach and mushroom lasagna or rosemary chicken for lunch in the restaurant.

Farther down the counter is a hot grill, where grilled or pasta lunches to-go or eat-in are prepared in the customer's view. Cafe TuGogh serves what Shapiro calls a "bistro-y menu that is casual but unusual," like marinated quail.

Because of space constraints, the grill is Cafe TuGogh's only area with food-preparation interaction with customers. Cafe TuGogh's primary kitchen, indeed, is up a flight of stairs. Shapiro said employees who regularly tote heavy platters downstairs call the duty "free aerobics."

Turning right, customers walk through an attractively merchandised wine section showcasing at least 2,000 different wines at any given time, according to Jasper Russo, wine buyer and general manager of the operation. Restaurant customers can also order wine by-the-glass, of which there are eight varieties that change out weekly; or choose among 125 half-bottles. But, to maximize wine margins, Shapiro said the waitstaff always sells up.

"Our purpose is to sell bottle wines, not just a glass of wine. Our waiters double as sommeliers. We do a tremendous amount of bottle wine sales in the evening," Shapiro said.

The requirements for working as sommeliers/waiters or gourmet food preparers for takeout -- while simultaneously grilling for customers wanting to eat inside -- takes a better-educated and trained employee. "Our employees are all 'foodies' with a lot of dedication," he said.

Marty's/Cafe TuGogh's strategy in blending individual and bulk takeout, casual eat-in and fine dining is to capture the customer at all times of day and circumstances.

Shapiro explained that the Marty's and Cafe TuGogh customer changes dramatically throughout the day. The lunchtime crowd is comprised of office workers who both carry out and eat in. Later, harried commuters snap up meals-to-go for their families.

Starting at 6 p.m., older residents from the nearby affluent Highland Park neighborhood drop by for a quiet full-service dinner, but the crowd gets younger as the evening progresses, for Marty's/Cafe TuGogh is located in the trendy Oak Lawn neighborhood, whose yuppies enjoy live entertainment with dinner.

The restaurant itself makes a smooth transition from casual daytime, where nearby office workers grab a quick lunch, to dinner's white tablecloth and silverware, low lighting and full service from a menu Dallas newspapers rate as three-star.

Because of his changing customer mix, Shapiro said he doesn't have direct, but diffuse, competition not only from Eatzi's, but from several nearby Tom Thumb and Kroger Co. supermarkets, the gourmet-oriented Simon David Supermarket several miles away, and nearby liquor stores.

Today's eclectic offerings are a world away from Marty's origins in 1943 when Shapiro's father, Jack Shapiro, opened a simple liquor store during World War II.

After son Larry joined the business in the early 1970s, Marty's hired a French chef to develop gourmet takeout and make pate in-house, partially as a way to capture women's business. Meanwhile, catering growth provided a natural segue to carrying similar gourmet to-go foods.

Knowing he wanted to "bring takeout to the next level," Shapiro realized the liquor had to go -- a risky decision because even that 14% of sales represented $1 million a year.

In the meantime, Eatzi's opened. Shapiro said the competition draws customers to both stores, but he delayed opening a few months to probe Eatzi's weaknesses.

"Just by walking across the street, I can see what they're doing right and wrong," he said.

As the "quiet, peaceful" choice, Cafe TuGogh has clearly prospered and boosted overall performance figures. In 1996, gourmet sales were just 26% of total sales, while wine dominated with 60% and liquor pulled in an anemic 14%. Two years later, gourmet sales have burgeoned to 45%, of which takeout is 25% of total sales, compared with 11% two years ago, according to Shapiro.

It took about a year to recover the dollars lost from the dropped liquor but Shapiro said same-month sales are up 30% through June. Even better, "given that we lost 14% of our sales in one whack, rising 30% in total sales over 20 months means our real sales increased 44%" since developing Cafe TuGogh.

Altogether, Marty's/Cafe TuGogh's gross profit has increased 6 percentage points since 1996, "and that's massive. I attribute it all to getting out of liquor and into food," Shapiro remarked.

Eatzi's, of course, remains an ever-present challenge. Shapiro competes for passers-by with signage: the Cafe TuGogh logo phonetically clearly states its business, and the allusion to artist Vincent Van Gogh -- who appears on the logo in chef's cap -- provides the vital upscale image. Believing the store's appeal is best revealed in color, he also promotes Cafe TuGogh in high-quality four-color ads, placed in magazines his mostly affluent clientele read.

For now, Shapiro is considering opening a smaller Cafe TuGogh and wine bar, containing a smaller wine section and fewer gourmet bulk foods, late next year. Eventually, perhaps, he'll open similar units in other cities, he said.