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What's in Store - Restaurant experiences in retail settings
Ready-to-eat products comprise a growing share of the retail counter
By Christine Blank
October 01, 2013
Ready-to-eat meals have played a prominent role with retailers over the past few years as shoppers seek tasty, healthful meals on the go. The take-home product category will take center stage when The Fish Counter opens in Vancouver, British Columbia, next month. Owner Robert Clark, former executive chef with C Restaurant in the same city and a sustainable seafood advocate, sees no end to the value-added meals trend.
“The largest-growing segment of the retail market is prepared foods to take home. I don’t think people are cooking less — in fact, more people are buying cookbooks and gourmet ingredients — but they need help Monday through Friday,” Clark says.
In a takeout section of the store, The Fish Counter will offer “fast food” with a healthy twist, such as fish tacos and fish and chips. “I hope [prepared foods] turns into a big portion of our business,” Clark adds.
The ready-to-eat meals will be prepared in store and include Niçoise salad (traditionally made with tomatoes, green beans, eggs and olives) with or without tuna, smoked salmon and seafood soups. The Fish Counter will carry between eight and 10 packaged prepared seafood items daily when it opens.
Fresh prepared foods represent a $26 billion market in the United States, with sales growing nearly 6 percent from 2007 to 2012, according to foodservice consulting firm Technomic. Conversely, foodservice sales grew less than 1 percent during the same time period, according to Technomic’s recent report, “Fresh Prepared Foods: A Growth Driver For Your Company?”
“Ready-to-eat foods are where the sales are going in grocery stores. The reason grocery stores have trouble making money is that the money is tied up with items on the shelves,” says Steven Johnson, grocerant guru for retail and restaurant consultant Foodservice Solutions.
“In reality, as a new generation of fresh prepared foods offers what is perceived as a fresher, healthier alternative, packaged goods manufacturers are under threat,” adds the Foodservice Solutions report. U.S. restaurants and other foodservice outlets are also threatened by the rapid growth in retailers’ prepared meals, which are featuring seafood more often.
“Full-service restaurants, especially, cannot offer the same convenience as fresh prepared foods, and innovation in many restaurant segments has been lacking. Whereas menus have not changed substantially in recent years, upgrades in retailers’ fresh foods departments are more readily apparent to the consumer,” the report states.
And the growth of the prepared-meals category does not appear to be slowing down. Prepared-food sales will increase by 10 percent over the next decade, compared to a predicted 4 percent increase for commercial foodservice sales, according to a recent report from The NPD Group. Retailers that sell value-added meals should benefit from the growing interest in prepared meals by baby boomers and consumers in their 30s over the next 10 years, The NPD Group found.
Food retailers that are succeeding at the prepared meals game are offering portioned, healthy, restaurant-quality meals, according to Technomic. “They also feature contemporary culinary influences and a ‘better-for-you’ orientation that make fresh prepared foods an appealing alternative to the takeout market, which is dominated by pizza delivery, chicken chains and Chinese restaurants,” the report states.
“We want to offer something different, fresher and faster,” Clark agrees. “We want to make things that taste more authentic than the standard is now, which will encourage people to eat more fish and vegetables.”
Prepared meals are the fastest-growing part of the business for Jack’s Pak-it in Beaumont and Lumberton, Texas. The product category now makes up one-third of all foodservice and deli sales, says owner John Blanda. Ready-to-eat meals have expanded the store’s deli space four times over eight years, notes Blanda.
Jack’s Pak-it offers Shrimp Etouffee every Friday and it has become a staple for loyal shoppers. Its Shrimp Spaghetti is also very popular, and is sold for $14.79 for a quart-sized metal tin that can go right into the oven.
Blanda says a successful prepared-foods program helps him make customers happy, turn a profit and beat the competition. “We are flanked by Market Basket and Kroger stores. Fresh foods is our ace in the hole,” he says.Contributing Editor Christine Blank lives in Lake Mary, Fla.