Today, multiple forces are impacting retail foodservice all at once: the persistent COVID-19 pandemic, the rapid rise of delivery apps, more restaurants getting into the to-go game, inflation, the labor shortage. Given this disruptive environment, how can grocery retailers ensure their foodservice offerings remain relevant, convenient, affordable, high quality and overall enticing to consumers? Here are nine solid suggestions.
Foodservice trends expert
Rick Stein, vice president of fresh foods at FMI-The Food Industry Association
Enable personalization. Shoppers like to customize and cherry-pick. That's why they love salad bars and hot bars, which let them choose the items and amounts they want. That's also why retailers' meal kits are not performing as well as one might expect. Look, side dishes like mashed potatoes, salads and vegetables are selling like crazy right now because they're huge time savers. When you put those items together as a kit, not everybody likes every item, so customers won't buy it. But when you offer them à la carte, they can easily put meals together. So, any way you can create personalization, do it. It's about taking the things you do well and enabling customers to make choices.
Spark ideas. In retail foodservice, we've moved beyond the era of just providing items—now we need to provide menu solutions. In the past, retailers would gather all relevant items and put them in one location, but customers don't need us to do that for them anymore. If you feed them an idea, they will shop the store for the other items they need. For example, they'll buy a rotisserie chicken, planning to put some in a casserole and use some in salad, then they'll go grab the pasta, soup and greens. The best place to provide ideas is on your digital platforms, but you can also do it at the store level, such as by writing tips and recipes on a chalkboard in your foodservice area.
Broaden your potential customer base. Too often in this industry, we look only at the grocery store down the street and ask, "How do we convert their customer to our customer?" With foodservice, retailers need to think broader—your competition is no longer just other stores. At 3 p.m., 70% of people still have no idea what they're going to do for dinner, which means you're also competing against local restaurants, pizza delivery and fast-casual spots. Work on improving your technology and collaborative partnerships to get on customers' radars as a dining solution. For example, if they pull up DoorDash, where does your store show up on that list? There are ways to address that. Also work with Google to increase your visibility.
Bart Yablonsky, owner of Dawson's Market in Rockville, Md., and Washington, D.C.
Revive self-serve, but to capacity. Now that it's clear you can't easily get COVID-19 from touching things, that fear is mostly gone, and self-serve has come back. We reopened our salad bar first because it requires less attention than our hot bar. But instead of keeping 16 pans running from lunch through dinner every day, we reopened only half of the hot bar—and just during lunch Monday through Friday. Before [the Omicron variant of COVID-19], sales were improving each month, and as the year goes on, I expect business to keep picking up. I hope to open the whole hot bar eventually, but not until we have so much traffic that we constantly need to replenish it. Otherwise, it doesn't look attractive. We've been merchandising beer, wine and other items there to fill the empty spaces.
Cater to daters. In the height of the pandemic, when indoor dining was shut down, we began offering Date Night Dinners, pairing items we'd normally produce for our hot bar with top sellers from our deli case. These were always successful, and although sales slowed down when restaurants reopened, we've continued to offer them, just less frequently. We generally give a choice of two appetizers, two entrées such as steak or crab cakes, two side dishes and two desserts, and customers have about a week to place an order. I think this is a great way for people to try our prepared foods and see what we can do—and hopefully, it represents our catering capabilities and helps bring that business back up.
Partner with local restaurants. Besides what we make in-house, we bring in some prepared foods from local restaurants and artisan producers. For our hot bar, we've rotated in Greek food, Romanian food, Indian dishes and pastas throughout the week, all made by local restaurants. We also offer many grab-and-go items, such as dips and even entrées, from these places. Our customers always love to see local products, so this is a great way to give them items we're not super skilled at producing while also supporting local businesses. When not restricted by the pandemic, we do a lot of demos and have a recurring Meet the Locals event featuring 10 to 15 vendors, which customers get really excited about.
Culinary innovation consultant
Chef Steven Petusevsky, foodservice consultant to several leading natural retail chains nationwide
Hire restaurant-caliber culinarians. Retailers are competing with restaurants now, so they need to up their game. Since the pandemic began, restaurants have had to find ways to survive, so many have turned into to-go retail operations, selling pantry and perishable items. Plus, most have gotten much better at preparing and packaging meals to-go. This trend isn't going anywhere — in fact, it's ripening. As a result, retailers have to amplify their kitchen skills. This requires hiring at least a core group of people with culinary talent to lead innovation and product development. And to attract culinarians, retailers must offer competitive wages and other incentives.
Consider a ghost kitchen. Consumers today are looking for convenience, comfort, healthy foods and global flavors. But thanks to COVID, there's another consideration: safety. And because consumers now have so many foodservice options, they have less patience for poor execution than they used to. With that in mind, retailers must be careful to not overstep the talent or abilities of their prepared foods department. I'm not saying aim low; just don't aim higher than your team's technological and culinary abilities allow. So, given the current labor shortage, instead of hiring culinarians, many retailers are turning to ghost kitchens to fulfill foodservice needs—and there's nothing wrong with that solution. Just make sure the third-party partnership is strong.
Strategize packaging. Packaging plays an extremely important role in foodservice's culinary trajectory, so it deserves strong consideration. Consumers care about the type of packaging used, presenting a novel challenge for retail foodservice operators. Now we have to determine the best packaging from several standpoints, including convenience, sustainability and safety. It needs to hold up, but is it only microwavable, or can customers pop the whole thing in the oven? Then, on the other side of the coin, you don't want to use too much packaging, which can be seen as a signal that you don't care about the environment. As for what's more important, sustainability or convenience, that's an individual decision and dependent on the store's mission statement.
This article originally appeared on New Hope Network, a Supermarket News sister website.