Deli Business ‘Balancing Act’

Feature Article

Balancing Act

Weighing the Variables for Successful Salads and Sides Programs

What does today’s well-stocked deli department offer in salads and sides? Retailers and manufacturers answer with a resounding, “It depends.”

In their infinite variety, salads and sides offer deli departments limitless opportunities for differentiation. By balancing key variables—traditional versus trendy flavor profiles, full-service versus grab-and-go, made-from-scratch versus ready-to-sell, and center-of-plate versus on-the-side—retailers can clearly define and express what their particular deli department is about. By varying the mix at store level, retailers can use salads and sides to appeal to any customer base.

“Everybody sells Kellogg’s Corn Flakes and Coca Cola, so retailers look to perishables to differentiate themselves from the competition. In the deli department, the mix of salads and sides—including at least a few one-of-a-kind proprietary recipes—are a great way to accomplish that,” says Jeffrey Siegel, president of Brooklyn-based Chloé Foods Corporation. The company’s Blue Ridge Farms makes and distributes refrigerated salads, vegetables and entrées in bulk and pre-pack.

Traditional or Trendy?

Alongside the turkey, ham and roast beef, consumers expect virtually all deli departments to stock classic versions of the time-honored trinity—coleslaw, potato and macaroni salads. Among the protein-based salads, chicken, tuna and ham are the mainstays. Standard sides are macaroni and cheese and mashed potatoes. But these days, consumers want variety as well.

“Right now we’re changing our salad program to make a wider variety available because that’s what our customers want,” says Sue Cousineau, deli supervisor for Econo Foods, an independent six-store chain based in Iron Mountain, MI. “They get tired of the same old potato salad, macaroni salad and coleslaw. They’re buying more often and they want more variety.”

“Our customers want to see that we are on top of food trends, but they also want to make sure that we don’t lose any of their traditional favorites,” says Melinda Mills, deli buyer for Andronico’s Market, a 10-store San Francisco Bay-area gourmet supermarket chain based in Berkeley, CA.

Delis and their suppliers are responding to growing consumer demand for the trendy as well as the tried and true by offering classic recipes as well as more exotic, upscale versions of the classics.

“In addition to the traditional flavors they’ve had for years, people are interested in more exotic, more authentic flavors,” says Don Graff, director of marketing for Reser’s Fine Foods based in Beaverton, OR. To fill the need, Reser’s offers more than 20 varieties of potato salad, three coleslaws and nine macaroni and pasta salads, plus several types of mashed potatoes.

With its line of Stouffer’s brand frozen sides, Glendale, CA-based Nestlé FoodServices-North America keeps delis well stocked with popular classics—macaroni and cheese, potatoes au gratin, and scalloped apples. “Stouffer’s is known for its home cooking,” notes Kathy Lenkov, communications manager for Nestlé FoodServices. “The brand’s tag line is, ‘Nothing comes closer to home,’ and most of the sides tend to be classic comfort foods.

“For delis wanting to offer more progressive, on-trend items,” adds Lenkov, “we have our Minor’s sauces, bases and flavor concentrates. The flavors consumers are looking for, and the trends we’re hitting, are very bold, authentic Southwestern, Asian, Mediterranean and Latin flavor profiles. Besides being on trend, the Minor’s line saves labor and contributes to better consistency.”

“One of the strongest and fastest-growing trends is the ‘New American Palette,’” contends Mark Brown, president of Orval Kent Foods, a division of Chef Solutions, Inc. The Schaumburg, IL-based company manufactures and distributes branded and private-label refrigerated deli salads, mashed potatoes and other side dishes. “Americans are experimenting with an international buffet of flavors, spices and preparations, and they are looking to the deli for new taste ideas.”

“Americans are exploring different ethnic foods more than ever before,” agrees Mills. “At Andronico’s, we’re exploring recipes that touch on a number of different ethnic influences—Mediterranean, Spanish, Asian and Italian.”

“Ethnic and fusion foods combining tastes from Asia, Latin America and the Mediterranean are hot,” notes John Loughridge, marketing vice president for Del Monte Fresh Produce N.A., Inc., based in Coral Gables, FL. “Using fruit, especially tropical fruit, to add excitement to salads is also hot.”

Eat Your Veggies

For many deli customers, salads and sides enjoy a more healthful reputation than their cold-cut counterparts, making the category ideal for appealing to the growing number of health-conscious consumers.

“Natural and organic is our fastest-growing segment,” notes Jennifer Panchenko, director of food service for 12 Byerly’s and eight Lunds stores owned by Lunds Foods Holdings, Inc., of Edina, MN. “The majority of the world are baby boomers who are much more conscious of what they put in their bodies and who make more educated decisions about what they’re going to eat. Right along with that, people are looking for very full-flavored, but still natural foods. We’re also seeing a trend out of pastas and heavy starches into lighter grains and protein salads.”

“Produce equates to ‘fresh’ and ‘healthy’ in consumer’s minds, but preparation of fruits and vegetables has traditionally been a barrier,” says Loughridge. “As they update their offerings, delis have an opportunity to address consumers’ needs for good nutrition, convenience, speed and great taste by adding more fresh, healthful ingredients.”

Consumers’ definition of “healthful” is changing as well. “People aren’t necessarily looking for low-fat or low-calorie, the way they were 15 years ago,” says Siegel. “Now they’re looking for something more natural and nutritional.”

“Super foods and whole grains are really big at Andronico’s right now,” says Mills. “These are foods that go beyond just being nutritious, but also help to fight disease and make you healthier. Consumers are looking for foods that are rich in such things as fiber and antioxidants.”

“Functional, virtuous foods that improve health, vitality and performance have captured the attention of all consumers,” says Brown. “‘What’s in it for me?’ is now one of the first questions asked when making a purchase decision. In a new survey by the Grocery Manufacturers of America, the GMA, 73 percent of consumers said they are buying more nutritious foods than ever when they shop. They are looking for whole, unrefined grains and reduced and low-fat and low-sugar products. And, nearly 60% are looking for vitamin-fortified foods. Well beyond, nutrients, vitamins and fiber, people want to know, ‘Will it provide me with additional energy? Can it fight disease? Is this a harmful or helpful fat?’”

Even as they demand health benefits, consumers remain unwilling to compromise on taste. “No matter what the latest trends are,” says Mills, “first and foremost, people will always want food that tastes good.”

Center-of-Plate or On-the-Side?

As the category name suggests, side dishes are usually served as an accompaniment to an entrée. Deli salads are more versatile. Protein-based chicken, ham and tuna salads can be central to a meal, either on their own or as a sandwich filling. Many vegetable and pasta salads can move to the center of the plate with the addition of protein. 

“People are eating salads as meals now, and a lot of our salads do have either ham or chicken to make them full-meal salads,” says Cousineau of Econo Foods. “Years ago, you didn’t have too much of that.”

“With the new USDA food guidelines, at least 50 percent of what’s on your plate should be fruits or vegetables,” notes Loughridge. “To eat healthier, we need to move fruits, vegetables and grains to the center of the plate, with protein and dairy in smaller portions.”

Behind the Glass or Grab and Go?

In response to consumers’ growing demands for convenience, many deli departments are offering an increasingly diverse selection of salads and sides at both the full service counter and in self-serve formats.

“Almost all our salads and sides are available in the service case as well as grab and go,” says Panchenko. “Especially if they already know it’s a salad they love, many of our customers prefer the convenience of self-serve.”

“With the addition of self-serve hot stations, we’ve watched our sales on rotisserie chickens grow steadily year after year,” says Mills. “With the increase in chicken sales, we’ve watched an increase in the sale of side dishes that are pre-packaged and ready to pick up.”

“You tend to see more exotic specialty items behind the case, where the retailer can put the labor behind the higher-dollar products,” notes Scott Torrey, vice president of sales and marketing for Orval Kent Foods. “The full-service, pre-packaged balance will vary by region, too. In the northeastern United States, consumers are most familiar with highly-developed, full-service deli counters, while the shopping dynamics of the southeast make it the leading region for pre-packaged products.”

For most deli departments, it simply makes sense to offer both options. “When you know what you want to get, and just want to go in and get it, grab-and-go is great,” says Mills. “If you’re in the mood to explore, then nothing beats an old-fashioned service counter. A consumer can actually talk to a live person who can give, not only an opinion on any particular item, but also offer a taste.”

Still, there are those retailers who differentiate their delis by bucking the grab-and-go trend. “There’s nothing prepackaged here,” says Andy Hanna, deli retail manager for Zingerman’s in Ann Arbor, MI. “There’s a place for grab-and-go, but we’re not that store.”

Some Assembly Required

Just as consumer demand for convenience has accelerated, so has deli retailers’ interest in time- and labor-saving products. Produce suppliers deliver vegetables and fruits hand-cut to order. Coleslaw dressings arrive ready for the addition of cabbage. Makers of component kits package multiple ingredients together for assembly in-store.

“Produce companies make it really easy to put together almost any vegetable-based dish you can think of,” says Mills. “Many companies allow you to specify the ingredients, how to cut them, and how to package them, giving us the opportunity to have a dish half made before we even put on an apron.”

Siegel believes component kits, while considered by some deli buyers as too labor intensive and costly, present a powerful, but underutilized, opportunity for improving quality. “The kits have been slow to take off because at store level, retailers don’t want to bother with anything beyond opening a bucket, even though they know a vacuum-packed kit can be a hundred times better.” Blue Ridge offers both regular and “deluxe” versions of a tortellini with ham salad kit, a coleslaw dressing and a chicken salad base, along with kits for Greek salad, Italian pasta and “Texas Caviar,” a bean salad with black-eyed peas.

“There are retailers who do a tremendous job with kits,” says Orval Kent’s Brown. “Typically most are on the higher, more upscale end of the market. Kits are right for those folks who are committed to the category. Then, there are other retailers that probably can’t support it. It all depends on the strategy.”

“Clearly, there’s a demand for kits to assemble in-store, but it varies depending on the type of customer,” says Graff whose company, Reser’s Fine Foods, offers 14 kit salads. “While some retailers don’t want to invest labor in putting together kits, the delis that are on that strategic page have trained their people how to make kits so they can offer the best quality fresh salads every day.”

In addition to improving quality, Loughridge maintains the use of component kits can help deli departments improve consistency, control food cost, reduce sanitation problems and minimize liability. “With a kit, Del Monte typically provides all the ingredients except dairy and protein—the pre-cut produce, the dressing and any other ingredients like nuts and croutons. The recipe can be standard or unique to the retailer or foodservice operator, and it will be consistent from batch to batch and store to store. The food cost and portions provided are known. Compared with preparing from scratch, the kits require less labor and minimize the store’s liability of cutting and preparing ingredients as we provide them from a specialized plant with proper cold chain, raw material controls, sanitation and HACCP programs.”

Mills says Andronico’s continues to make nearly all salads in-house. “We have explored using pre-fabricated items,” she says. “In our hot soup bars, for example, 80 percent of our soups come from an outside source, while we still make 20 percent of them on site. This frees up some much-needed labor in the department, while keeping our quality high.”

Lunds and Byerly’s makes virtually all their salads and sides in-house, but not always in-store. “We have a central kitchen facility where we produce all our salads and sides ourselves,” says Panchenko. “Most of the things we send out ready to sell, but there are some we send out in kits to be put together at store level.”

In implementing its expanding salad program, Econo Foods will use a combination of from-scratch products and pre-made ingredients from outside manufacturers. “We’ll be making many products in-store, but we’ll also bring some in because there’s no possible way we could make them all ourselves,” says Cousineu. “What we decide to bring in mostly is because the kitchens aren’t set up with the equipment we need to offer the variety we want”

For Zingerman’s, pre-prepped ingredients are not an option. “We do everything so painfully from scratch that it nearly kills us,” says Hanna, just returning to his office from helping harvest asparagus. “The one prefab ingredient we use is mayonnaise”

Exclusively Yours

Retailers seeking to differentiate their deli departments by offering unique salads and sides are not only developing signature dishes in-house, but turning, in increasing numbers, to suppliers for expert help in creating and/or producing proprietary recipes.

“You can get some standard products from Andronico’s, but most of the dishes served in our delis are one-of-a-kind items that you can’t find anywhere else,” says Mills. “We want to make sure that our salads and sides are unique to our stores. An item such as Caesar salad can be bought almost anywhere, so we make sure we have something that sets ours apart from the rest. We take pride in using the knowledge of our chefs in creating new and exciting dishes.”

“Retailers that make deli a destination pride themselves on differentiation, and often, proprietary recipes are part of the strategy,” says Brown. “Everybody wants a different taste profile, and we are very accommodating. Our R&D organization will sit down with retailers, find out their needs and wants and formulate to their requirements.”

“With the competition out there, there’s always a demand for proprietary items,” says Nestlé’s Lenkof. “Our chefs go right out to the delis and work with our customers to help them develop a signature sauce or side dish.”

Recipes for Success

As the diversity of retailers’ and suppliers’ approaches clearly demonstrates, the secret to success with salads and sides is to realize there is no secret.

“There is no set formula,” says Loughridge. “What’s popular in Columbus, Ohio, may not be popular in Seattle or El Paso. What works in a high-end, gourmet deli may not work in an inner city value format. Urban locations may do well with grab-and-go and more home meal replacement offerings. In some rural areas, shoppers may prefer to buy whole produce. Supermarkets in areas with families and kids will differ from outlets with young singles or older empty nesters as the primary customer base. It all depends on the retailer.”

Sidebar:

Selling Salads & Sides

Sampling

“Samples are great way to get shoppers to try something new,” says John Loughridge, marketing vice president for Del Monte Fresh Produce N.A., Inc.

Mark Brown, president of Orval Kent Foods, recommends, “Sampling, sampling and more sampling. Delis are a great place for consumers to experiment with taste.”

“We do in-store sampling all the time,” says Sue Cousineau of Econo Foods. “That sells product very well.”

“Nothing beats putting the food in the customers’ mouths,” agrees Melinda Mills of Andronico’s Markets. “We do regular tasting that ties in with new items, holidays, seasons and cross-merchandising with other departments. This is the best way to influence the customer to purchase.”

Merchandising

“Good store merchandising is critical, as people shop with their eyes,” says Loughridge. “Colorful, fresh, healthy-looking offerings that are very easy to see will drive sales.”

“It’s said that you eat with your eyes before your mouth,” says Mills, “so we like to make sure that our dishes are presented in the best way possible.”

“Appearance is an attribute shoppers equate with quality, and 34 percent of shoppers make their deli decisions based on appearance,” says Brown. “Well-presented salads and sides attract consumers’ attention and improve their perception of overall quality in the deli department.”

“We change our planograms by the season, always with an eye toward presenting a good range of texture, color and variety,” says Jennifer Panchenko, director of food service for Byerly’s and Lunds. “We have signs that tell the name and the ingredients for every single product.”

Meal Deals

“We run specials where customers get a free side when they buy a whole chicken or a bucket of chicken,” says Cousineau. “Or we’ll have meal deals where you can get so many pieces of chicken with so many pounds of sides.”

“We have hot food menu specials with a different entrée each day,” says Panchenko. “We price by the meal, and the customer chooses the sides. The program has been very popular.”