WILL THIRD INCARNATION BE THE CHARM FOR EMILY'S MARKET?

SCOTTSDALE, Ariz. -- The management team behind Emily's Market says it believes there's still life left in the concept even though it has collapsed yet again, this time in its second incarnation here.What its managers are looking for now is the right real estate and/or the right partnership -- perhaps with a supermarket -- before launching a third time, according to Mark Cain, president and chief

SCOTTSDALE, Ariz. -- The management team behind Emily's Market says it believes there's still life left in the concept even though it has collapsed yet again, this time in its second incarnation here.

What its managers are looking for now is the right real estate and/or the right partnership -- perhaps with a supermarket -- before launching a third time, according to Mark Cain, president and chief executive officer of The Meal Market, the restaurant investment group that acquired the concept in 1996 from Circle K Corp., its originator.

The second Emily's, dubbed a "test store" by The Meal Market, was closed because customer traffic didn't reach the volume that was expected, Cain said. He claimed the low volume was due in large measure to location, as well as poor timing of its opening and a lack of advertising and promotion.

The first Emily's was opened in Chandler, Ariz. in March 1996 by Phoenix-based convenience-store operator Circle K. At the time, Cain, an executive working for Circle K, was installed as director of development for the concept.

In the fall of 1996, The Meal Market, a consortium organized by Cain, acquired Emily's, closed the doors in Chandler and began to develop plans for an incarnation.

The investment and management group launched the second version of Emily's, a 5,000-sq.-ft. store, here last May, but closed it down before the calendar year had ended.

The closing came just days after Cain announced expansion plans, claiming to have actual lease negotiations that would have included additional Emily's sites both here and in Tempe, Ariz. Those deals are now on hold, Cain said in an interview with SN late last month.

In hindsight, he said, The Meal Market has recognized that the location here wasn't the right one to generate sufficient customer traffic for Emily's.

"There needs to be significant drive-by traffic, and there wasn't here," Cain noted. "But it's difficult to sign advantageous leases."

He said that major corporations in the business, such as Boston Chicken Inc., have driven up prices for top locations, at least in the Phoenix area.

Cain said he expects that situation to shift. He told SN that he detects an accelerating trend in QSR closings in the market, which should soon give his management team the opportunity to take advantage of better sites as they open up.

"As BCI and Kenny Rogers shutter stores, we'll be in a position to pick them off. There's going to be a big inventory of real estate, and prices will come down," Cain said.

"We looked at what's going on and decided to wait. Our company has never been in a position to support just one stand-alone operation," he explained, adding that the plan was to go national with Emily's. When cost-effective real estate becomes available, "we'll open multiple stores."

Cain conceded that the timing of the Emily's opening here last May wasn't good.

"Opening in May was a tough decision," Cain said. Residents of Scottsdale and Phoenix tend to leave the area during the hot summer months, and those who remain aren't looking for hot food, he said.

He also agreed that the marketing of the new concept could have been better. Virtually no advertising accompanied the opening.

But Cain also stressed that there have recently been management changes within The Meal Market, moves that could help steer the concept toward success.

He said the clearest lesson learned at the Emily's site here is that "There are fairly static traffic numbers that can be achieved at a stand-alone."

A local industry observer told SN that he also believed the location was too far off the beaten path, and the store was further hobbled by being all but hidden behind a unit of California Pizza Kitchen.

"The demographics here are great, but the actual physical location wasn't good. The concept itself is good, and the food and service was, too. I hope they're successful somewhere else," the observer said.

The "somewhere else" could be inside a grocery store, said Cain, if he and his group can negotiate such a deal.