
Instead of focusing on holiday toy or fashion retail, today's New York Times and Wall Street Journal turned focus on the world of supermarket news - gourmet supermarket news.
According the the venerable "Grey Lady" the battlefield over epicurean palates and pocketbooks is heating up, with Whole Foods, Dean & Deluca and Balducci's leading the charge:
The success of Whole Foods Market, an almost $4-billion-a-year organic-food specialist that landed in Manhattan several years ago and is only getting bigger nationally, has shown the potential for high-end niche foods. Now, some of New York's home-grown grocery chains are planning to test the market well beyond Manhattan.
"There is no reason why Balducci's couldn't expand significantly along the East Coast," said Mark S. Ordan, a partner in Balducci's, along with Bear Stearns Merchant Banking, the controlling shareholder.
At the moment, Balducci's, once in Greenwich Village, has its only Manhattan store tucked in a hidden corner behind Lincoln Center. ("The worst location in the world," Mr. Ordan said with a laugh.) Along with their $10 million deal to buy that location about a year ago, the partners also bought Sutton Place Gourmet and Hay Day Country Market gourmet chains, renaming them all Balducci's.
In May, the owners plan to open a 20,000-square-foot flagship store in a former bank building at the corner of 14th Street and Eighth Avenue in Manhattan, a landmark they have nicknamed "the temple of food."
Dean & DeLuca has already expanded to Japan, among other places. The small chain is looking for a store in Los Angeles.
The market for gourmet groceries is growing nationally; last year, it topped $22.8 billion, according to the National Association for the Specialty Food Trade. From 2001 to 2003, it grew more than 24.1 percent. For 2004, the trade group expects sales in dollars to increase another 10 to 12 percent.
And, if the Journal has it right, Texas' own HEB Grocery Stores is beating out Wal-mart by catering to local tastes:
[HEB founder Charles E. Butt] signed off on a plan to make fresh produce and high-quality meats the chain's hallmark. He spiced up the formula with cooking demonstrations at some stores, stationing chefs in kitchen booths in the middle of the store floor to whip up recipes and answer shoppers' questions. In-store tortilla makers churn out fresh, hot tortillas all day.
At the same time, Mr. Butt insisted that prices stay competitive with Wal-Mart's. At headquarters in San Antonio, Mr. Butt drives home the message that managers must learn to think like the customer, not just about the customer. In one exercise, HEB's president of food and drugs, Suzanne Wade, handed $20 to several employees and told them to feed a family of four for a week. "We found out why beans and rice and tortillas sell so well," she says
To emphasize its Texas roots, HEB has specialized in developing its own branded products tailored to specific community needs and tastes. For instance, managers in the Rio Grande Valley discovered an annual summer spike in rubbing alcohol sales came from customers who couldn't afford air conditioning and used the alcohol on their skin to keep cool in the sweltering Texas heat. Since alcohol also dries out the skin, HEB worked with manufacturers to develop its own brand of rubbing alcohol with moisturizers, which now makes up a quarter of its rubbing alcohol sales.
And while outdoor grilling is a Texas passion, not all Texans do it the same way. Along the southern border HEB stocks its stores with the large metal discs, called discos, that Mexican-Americans use to cook their brisket. Further north, it sells the gas grills and barbecuing gadgets that Anglos prefer.
Wonder what Mr. Butts would dream up, if he were to open an HEB in NYC. Whole Foods, Dean & Deluca and Balducci's better watch their backs...