Here’s a fact you can sink your teeth into: By 2020, prepared foods is expected to be a $65 billion business for retail operators, according to the International Foodservice Manufacturers Association. That surge can be attributed to more shoppers seeing grocery stores as dining destinations where they can grab prepared foods to eat in-store or to take home and enjoy later. Fifty-seven percent of consumers bought prepared foods from a grocery store in a three-month period, according to market research firm Technomic. And one-quarter of consumers ate on-site in the grocery store’s seating area. The younger consumers are, the more likely they are to think of supermarkets as a dinner option: 64 percent of millennials eat prepared meals from grocery stores, compared to 51 percent of baby boomers.
For in-store bakery managers, appealing to these demands can mean thinking more like an artisanal bakery or restaurant than a retailer.
“Whole Foods, of course, has had great historical success in the prepared meal space, with roughly 20 percent of sales coming from foodservice and prepared foods over the last several years,” says David Morris, an analyst at Packaged Facts. “The rest of the grocery industry couldn’t ignore that degree of success for long.”
And the store-as-eatery mentality—from menu planning to ambience—isn’t just for affluent, urban areas. Savvy mainstream retailers are getting in the game.
“For the longest time, we were a very traditional supermarket, with customers mostly coming in to get ingredients for items to prepare themselves,” says Brooke LeBlanc Knight, a director at regional grocery chain LeBlanc’s in Louisiana. “But recently, we’ve noticed a big trend toward households where both parents are working and need something more. They’re trying to make a meal that’s healthy and appealing in a short amount of time, and that often means grabbing something from our bakery and deli to take home.”
Ready to think like a restaurant? Follow these tips from industry pros that have already jumped on the trend.
In 2015, LeBlanc’s rebranded to enhance its foodservice program. Five of its nine units are now LeBlanc’s Frais Marché, French for “fresh market,” which includes an expansive hot bar, coffee station, grab-and-go cases and seating areas for shoppers. And the response has been incredible. “When our customers from the original stores visit, they ask, ‘Where’s my seating area? Where’s our expanded hot bar?’ They’re jealous!” says LeBlanc Knight.
Stopping in for a quick bite only works if shoppers can actually get in and out quickly. So LeBlanc’s Frais Marché turned the typical store layout on its head: Now the extensive hot bar, bakery cases, salad bar and coffee station are in the center near the entrance, ensuring they’re the first thing shoppers see. In one location, management placed a register right near the bakery counter to speed up checkout for baked goods buyers.
Kroger-owned chain Mariano’s has grown from one Illinois store in 2010 to 37 today, in part because it’s winning the foodservice trend. “Many locations have restaurant/foodservice kiosks, with customer seating located in the heart of the prepared foods space,” Morris says. Tables aren’t just plentiful—they’re situated near mounted TVs and newspaper racks, giving diners even more reason to take their time over a prepared meal.
And at LeBlanc’s Frais Marché, the seating area offers a mix of dining tables for full meals and a comfy couch for more relaxed eating and drinking. “We have a coffee bar near the bakery section, and some shoppers stop to grab a coffee and a muffin and then head to the couches with their laptop to do a bit of work,” says LeBlanc Knight. The condiment bar is stocked not just with cream and sugar but also butter, jam and honey for bakery items that shoppers want to eat on-site.
When LeBlanc’s started offering single-serve muffins alongside its usual four-packs, shoppers with kids rejoiced because everyone could pick his or her own flavor.
But, single isn’t always better. “Single, fresh baked buns still require other purchases to make that meal complete,” Morris says. Coordinating with the deli counter to incorporate more bakery items into prepared meals—complete sandwiches, for instance—creates value-add for shoppers while bringing brisk business to the bakery department.
Dessert is one product line where offering smaller portions can actually increase sales. “We still sell large cakes, but we noticed that more people were asking about buying cake slices,” says Jeanine Elgin, director of bakery operations for LeBlanc’s. “So now we give people options: a slice they might enjoy in our seating area, a half-cake that might be dessert after dinner at home, or a whole cake.” The response was so positive, LeBlanc’s recently expanded its sizing options to pies. “I had to train a lot of people on that,” Elgin laughs. “Keeping the filling intact is all in the way you cut it: Let it cool completely, and use a wet knife.”