October/November, 2005

From the Editor

Can't Do Without

The headquarters of Deli Business is in Boca Raton, FL, smack dab in the middle of the damage from Hurricane Wilma. All of us here at Deli Business got to experience the destruction first hand. No electric, no water, no gasoline, no traffic lights.

On the news, you saw people queuing up for gas, ice, water and what not. It was horrific. Yet by far the longest line I saw during the aftermath of the storm was the line for rotisserie chickens at Costco as soon as the store reopened.

Part of this was that people can’t cook without power. Part was that although the supermarkets were open, many of them had no electricity, no perishables and no way to cook anything. Most restaurants didn’t have power either.

I stood on that chicken line a long time and listened to the people talking. Beyond the yearning for a hot meal and complaints about eating tuna fish for several days in a row, there was an underlying message; that having someone else prepare your food has, for significant portions of our population, become a necessity.

True, this is Boca Raton, a very upscale community with a large number of retirees. But the whole nation is getting older, and as the population gets more affluent, this is a likely harbinger of the future.

The people on that line all cooked some. Many broke out the grill to cook meat that was defrosting in the non-functioning freezer. Many recounted times they made big holiday meals. But it was clear that these people did not cook daily.

Much as most people perceive riding a bicycle as recreation instead of transportation, cooking their own food is a form of recreation rather than a means of sustenance: “I’m trying Emeril’s recipe for lamb for my Labor Day Bash.” Whether they eat at home, at work or out, someone else did most of the cooking.

This shift is a revolution in human history. Traditionally only the wealthiest could afford to have others cook their foods. Today a plethora of foodservice outlets and an abundance of prepared items makes cooking optional.

The threat to supermarkets has been portrayed as principally from other venues, such as Wal-Mart, Costco, etc., but the transformation of consumer attitudes toward cooking is an extraordinary challenge. Supermarkets were designed to sell ingredients from which people could prepare meals. Now that function seems heading toward obsolescence.

Of course, there is nothing new here, as the industry has been talking about the “share of stomach” battle, Home Meal Replacement and the urgency of selling “restaurant quality food” for a long time now. But if the future was on line at Costco that post-hurricane afternoon, then all these initiatives are woefully small compared to the enormity of the transformation in consumer eating habits.

The transformation that is required focuses directly on the deli. In most stores, delis have a monopoly on cooking. However convenient the fresh-cut produce or well prepared the new items in the meat department are, in the supermarket only the deli delivers freshly cooked foods to consumers.

What those Costco shoppers were experiencing was not the loss of a luxury — it was the loss of a necessity. Getting their food — in this case rotisserie chicken — from Costco was the natural thing. Going to a store and buying a whole bird, marinating it and cooking it on a spit in the oven is as far from their realm of experience as plucking the feathers.

When viewed this way, the foodservice offerings at supermarket delis are too irregular. Costco doesn’t have a Mexican food bar, a wok station, etc., but it reliably produces exceptionally good rotisserie chicken. And if something is a necessity, reliability is crucial.

In this sense the attention paid to the multitude of initiatives deli departments are always launching is probably counterproductive. Because what is needed is not hundreds of types of food, the production of which strain the ability to produce consistently and the slow sales of which strain the ability always to offer fresh product.

This is a new paradigm forming. Up till now, the conventional wisdom was that the deli had two great competitive strengths: It offered a wide array of products so a shopper could satisfy everyone in the family in one place, and it was inexpensive compared to restaurant takeout.

But the price card is not likely to be that important to shoppers affluent enough to be the heavy users, and the wide array of products sounds good in theory. However, the number of delis that can consistently produce even a few truly excellent products is few and far between.

The people who came to Costco after Hurricane Wilma were not casual shoppers who happened to buy chicken. They came to Costco to get the bird and happened to fill up their carts with other goods.

This strikes me as the first goal for every deli department: What do we offer that pulls the customer in the door?

Every deli should offer a signature prepared food. It doesn’t have to be unique; Costco didn’t invent rotisserie chicken. But it should be excellent. It should be so good and the focus so fitting with the needs of your shoppers that it sells in high volume, allowing for quick turnover and so it is always fresh. It should not require extraordinary chefs to prepare it. In fact, your worst employees shouldn’t be able to mess it up.

If buying food already cooked is becoming a necessity, it means the deli department can become indispensable.

Ask yourself this: If a natural disaster hits your town, is there anything in your deli department that people would actively miss? If not, the name of that missing product is opportunity.  DB