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BLURRED LINES BETWEEN RETAIL AND FOODSERVICE
REACHING ACROSS THE AISLE
Collaborative supermarket retailers and produce suppliers can cash in on consumer desire for fresh menu items.
PBY CAROL M. BAREUTHER
roduce is the first thing you see after entering Gelson’s Markets.
However, this depart- ment isn’t the only place to find fruits and vegetables in this 27-store specialty grocery chain headquartered in Encino, CA. It’s also freshly evident at the salad bar, in gourmet salads, in made-to- order sandwiches, over pizzas prepared and branded in partnership with Wolfgang Puck. It’s also evident in one of the chain’s newest offerings: in-store, chef-created customized bowls with Mediterranean-inspired ingredi- ents such as greens and grains, served in a dining area adjacent to the retailer’s full-ser-
vice deli, called The Kitchen.
20 /APRIL 2018 / PRODUCE BUSINESS
One look at this in-store landscape and it’s easy to see that Gelson’s is one retailer leading the pack by offering customers the best of both worlds: retail and foodservice in a one-stop-shop.
“There’s no question we’re seeing more supermarket retailers put in grocerants and try to be all things to all people, and this is increasing by the day,” says Phil Lempert, president and chief executive of Consumer Insight Inc., in Santa Monica, CA, and founder and editor of The Supermarket Guru, which defines grocerants as stand- alone, full-service restaurants within or adjacent to a supermarket that may even serve liquor. Because of this, “there is a huge opportunity for produce that is not yet realized [to its fullest potential.]”
Americans do have a healthy appetite for eating out. In fact, and for the first time in more than a half century of tracking, the share of total food expenditures purchased away from home hit 50.1 percent in 2014, surpassing at-home food sales, according to the U.S. Department of Agriculture’s
Economic Research Service Food Expendi- tures Series data released in April 2016.
As to where consumers are eating, limited and full-service restaurants lead the way at 52 percent of total foodservice sales and $417.6 billion in consumer spending, according to the 2017/2018 International Foodservice Manufacturers Association (IFMA) Foodservice Landscape report, produced in partnership with Chicago-head- quartered Datassential. Onsite foodservice, meaning everything from schools, hospitals and lodgings to vending, corrections and the military, is second at 27 percent and a consumer spend of $180 billion.Retail foodservice is third at 21 percent and $61.9 billion. What is striking is this ranking is reversed when it comes to projected growth. Retail foodservice is first with an expected growth at 2.8 percent, compared with 1.7 percent for on-site and 0 percent for restau- rants. This makes supermarkets a bright spot in the overall foodservice landscape.
“Traditional foodservice’s tough year has caught the attention of retail supermarkets,”