« May 2007 Table of Contents 
Case Study: Cafés boost sales
Storewide communication necessary for in-store café success
By Lisa Duchene
May 01, 2007
Every morning, the restaurant chef at the newest Central
Market store near Dallas-Fort Worth chooses from about 100
fresh fish species in the store's 50-plus-foot seafood case. He
looks for the day's menu specials like Baja fish tacos made
with fresh tilapia, Kona Kampachi™ from Hawaii, or perhaps
grilled salmon with a Moroccan charmoula dressing.
Later in the day, customers entering the café see
demonstration plates of the specials, talk with chefs working
nearby and read about the blackboard specials.
Customers also see something on the specials board that they
normally wouldn't: "Made with fish available in our seafood
department."
Central Market, billed as a destination store for foodies
seeking freshness and convenience operated by San Antonio's
H.E. Butt Grocery Co., is right on trend: About half of U.S.
grocery stores in 2006 had in-store, sit-down eating areas,
according to The Food Marketing Institute, up from 36 percent
in 2001.
Supermarkets began adding cafés in the last decade to regain
some of the business lost to the restaurant industry as
time-pressed consumers replaced home-cooked meals with
restaurant-cooked ones. In 2005 and 2006, consumers ate an
average of 1.5 meals out per week, according to FMI.
In 2005, consumers spent $44.48 billion on seafood in
restaurants and $20.47 billion at retail, figures indicating
consumers are happy to reward chefs for their preparation
work.
Central Market is bucking the way this café trend is usually
executed. Most in-store cafés, while convenient for shoppers,
aren't integrated with the store or used to their full
potential as merchandising tools.
"Some stores are [integrating foodservice] but not enough,"
says Howard Solganik, a consultant with Culinary Resources in
Dayton, Ohio, who advises retailers on their prepared foods and
meat and seafood departments. "Most [departments] see
themselves as either sellers of ingredients or sellers of
convenience."
At best, most supermarkets neglect to link the
communications, operations and marketing of their foodservice
with departments like seafood, says Solganik. At worst, it's a
turf battle, he says, because typically everything from labor
allocation to bonuses is based on department sales. So
department heads often view a wholesale order from their
in-store restaurant as hurting their bottom line, says
Solganik.
Not so at Central Market. The seafood department, a 65-foot
display case in the café of 90 chef-prepared, take out items,
and the café's menu are all integrated. The menu features about
20 percent seafood.
"I have a great relationship with my seafood manager," says
Glenn Terrell, executive chef for Central Market's Southlake,
Texas, store. "I order fresh fish from him every day. He's not
losing out on anything."
Terrell credits H-E-B's hiring and training programs with
instilling a culture of teamwork that fuels successful
integration among the departments.
"If you hire talented, engaged people who want to learn and
empower them to make great decisions, the majority of problems
and challenges really go away,"
says Terrell.
But does this approach help the store sell fish?
"From the business side of things, it's absolutely
effective," says Terrell. Eight Central Market stores have
large seafood departments, with a ninth scheduled to open in
2008. Terrell's store is the fourth Central Market in Dallas
and the first with a café (the two other Central Markets with a
café are in Austin). The Southlake seafood department is a bit
larger than at other Central Markets.
Whether a grocery store café represents a merchandising
opportunity for the seafood department really depends on the
retailer,
says Solganik.
"What enlightened retailers have done is sell [the product]
at wholesale, but they give the selling department a retail
credit so it doesn't screw up their financials," says
Solganik.
Retailers that are doing a great job at integrating cafés
with their perishables departments include Ukrops in the
Mid-Atlantic and Roche Bros. in Massachusetts,
he says.
Solganik sees opportunity for supermarkets to drive seafood
sales by adding cooking stations within seafood departments and
designing a center-of-the-plate meat/seafood department with
raw proteins displayed on one side and a complete cooking
station in the center that makes the prepared foods on the
other side.
On a much smaller scale, Bill Dugan, owner and operator of
The Fish Guy seafood market in Chicago's Mayfair District, has
learned adding an occasional restaurant operation is great for
retail business.
On Thursday nights, Dugan sets up tables in front of his
cleaned-out seafood cases that during the day display about two
dozen seafood species. He tops the cases with fresh flowers and
candles, plays dinner music and hosts a five-course dinner for
12 people, serving four seafood courses and a dessert for $100
a head.
The restaurant, called Wellfleet, started Oct. 19. Every
Thursday since then, except when he closed for Thanksgiving,
almost every seat has been full, says Dugan.
He started the weekly dinners because of the popularity of
the shop's lunchtime lobster rolls and evening sushi
classes.
Wellfleet has helped the retail business enormously, says
Dugan, in large part due to local media coverage. Dugan has had
a surge in retail sales, and Wellfleet has also helped his
wholesale business as local chefs drop in and mention they
hadn't known about the store until they saw it in the
press.
"Everything on every level has been more robust," says
Dugan.
The dinners also educate guests. Dugan will introduce a
course and explain where the product is from, answering diners'
questions while keeping the explanation short.
For large and small retailers alike, in-store dining
represents an opportunity for increased sea-
food sales, as
long as it is well integrated with each department and well
executed.
Contributing Editor Lisa Duchene lives in Bellefonte,
Pa.