In the future, the sky’s going to be the
limit when it comes to virtual online
shopping and augmented experiences
in-store.” —Mark Hardy, InContext Solutions
foodservice section is often a good place to start
because, if done properly, it can be a gold mine,
says Kari Fulton, VP of national accounts for retail
at Menomonee Falls, Wis.-based Alto Shaam.
“The perimeter of the store has been growing
for a while, and the grocerant concept contin-
ues to be big,” she says. “Retailers are continu-
ing to see 30%-40% margins in those areas,
whereas the profit margins on nonperishables
are around 1%.”
Retailers are taking advantage of growing
foodservice opportunities and using them to
create extraordinary prepared food sections
akin to food halls. For example, Associated
Food Stores’ Macey’s division recently opened
a new location in Murray, Utah, that boasts an
Asian wok, a sandwich and wrap counter, and
its crown jewel, a fire pizza oven.
Additionally, Brown’s Super Stores—the
Westville, N.J.-based operator of 11 ShopRite
supermarkets in the Philadelphia area—
debuted its second store under the Fresh Grocer banner on Monument Road with a heavy
focus on foodservice. The cornerstone of the
55,000-square-foot building’s foodservice
offerings is Brown’s Chef’s Market, which
offers a wide variety of signature specialties
such as fire-grilled chicken, “sticky ribs,” Southern fried chicken and fish, plus Chinese dishes,
sushi and an extensive soup and salad bar.
At Brown’s, many customers get their food to
go, but others sit down and enjoy it in front
of the cozy fireplace while taking in the architecture’s pleasant, upbeat natural wood and
brick elements. An outdoor patio adjacent to
the indoor cafe allows patrons to dine, relax
and linger. The cafe also frequently hosts local
musicians on evenings and weekends.
By offering seating, retailers can turn the grocery store into a destination, where families can
dine together and—even better—grab groceries
for their weekly needs while they’re at it.
While the concept may sound promising,
retailers have to make sure they are not overdoing it. Taking up too much space with seating—
instead of using that space for something more
profitable—could be a surefire way to lose money.
“Because retailers calculate their profits
by square footage of the store, they have to be
very careful about how much seating they put
in there, as it has to pay them back,” Fulton
of Alto-Shaam says. “But they are definitely
changing and growing, because they do feel it’s
profitable for people to sit down and eat.”
Don’t Forget About Food Bars
Food bars provide retailers with a unique opportunity because they represent a stand-alone
occasion rather than a requisite grocery shopping trip, says Bill Chidley, partner for ChangeUp, a retail design firm based in Dayton, Ohio.
However, he says, food bars tend not to live up
to their full potential because they are often
underpromoted and suffer from a “proposition
deficit,” which Chidley defines as a lack of clarity on how they can create value for the shopper.
“That value needs to be clear and compelling
enough to change shopper behavior,” he says,
citing the importance of getting shoppers to
consider the retailer as a relevant alternative to
restaurants or packing a lunch.
Retailers often try to outmaneuver each other
on execution and variety instead of strategic
choices, Chidley says. To that end, he believes
many could benefit from institutional store-level
training—such as optimizing what is offered
With the ShopperMX
platform, real consumers
can “walk” through a
virtual store environment.