Convenience
There are many fine convenience chains in the United States and excellent examples of evolved models that have managed to combine convenience attributes with highly credible foodservice offers. Chains such as Wawa, Sheetz and Quik Trip succeed admirably with excellent operations and expansion into categories such as beverage and foodservice.
But the convenience store format has moved well beyond the traditional model in Europe, and especially in the United Kingdom. The staggeringly compelling Simply Foods from Marks & Spencer is one of the more unique and best-executed retail concepts we have seen, a format focused on serving consumer’s meal needs through a 100% private-label effort. Established grocery retailers such as Sainsbury and Tesco have built effective models, scaling back their grocery ranges to serve the needs of local markets. In Asia, convenience stores are supply chain marvels, with multiple daily deliveries that allow the transformation of format by time of day.
We now believe that convenience in the United States is nearing an impending inflection point. Forces from inside and outside the market promise to reshape how U.S. consumers will shop in the next decade.
This article is dedicated to exploring some formats that will shape that trend. As is often the case, a confluence of new formats and new ideas promise to be a wake-up call for this industry. From the meal-driven Really Cool Foods to a new format from Tesco, convenience in the United States may never be the same.
Really Cool Foods
Component Cooking?
Convenience is not a format—it’s a market-shaping trend. New concepts are being developed that defy conventional description. Even the names for these new formats are a struggle. Really Cool Foods is one example. It’s not a traditional grocery or specialty food store, but it’s not a traditional convenience store, either. It offers convenience—specialty organic/natural foods and fully prepared meals for immediate consumption—but it also offers component cooking (organic or natural meals that are prepped and ready to go for cooking at home in 20 minutes or less). This differentiated offering appeals to people who want healthy, home-cooked meals, but don’t have the time.
Unique concepts and innovative formats are transforming the convenience store industry. This special report, reprinted with permission from Retail Watch, takes an indepth look at some of the new, exciting players from around the globe that are reenergizing the traditional convenience model.
Really Cool Foods’ debut store, located on Third Avenue in Manhattan, lives up to its name—it is really cool. We were impressed with the food, the store, the beautiful design, and the look and feel. Not only is it spacious and bright, with 4,300 sq. ft., its large cooking area in the center is like a stage—an attraction that draws customers in to see what’s happening.
There is a professional chef cooking on multiple burners, with a neat display in front of the burners providing a display of all the ingredients needed to make each dish. Better yet, there is also a sampling in front of the products for customers to taste. The cooking stage allows the chef to demonstrate how to quickly prepare great-tasting food, giving the store instant credibility and authority on how to prepare a meal in 20 minutes or less. It looks easy, with the solution provided front and center. The chef cooked and explained how the meals were prepared. She also described variations to how the meals could be made at home. It was encouraging, and we were advised to switch out and test different ingredients based on our individual tastes. The opportunity for customization and a sense of personal satisfaction came right along with a tiny, tasty food sample.
While it was fun to graze and taste-test throughout the store, another useful feature is the to-go bags (“dish kits”), with prebagged recipes that have been assembled with all the ingredients for those on the run. The bags can feed three to four people, cost $12 to $15 per person, and offer a variety from which to choose. All of these pre-bagged meal-at-home kits take less than 20 minutes to make and they’re well-packaged, signed and displayed under the Really Cool Foods (RCF) label. RCF also sells a private-label line of premium chocolates and a “drizzle” line, which can be used in stir-fry dishes or as salad dressings, too.
Recipe cards are available via in-store displays. A customer can choose a recipe card and find all of the ingredients or components in the store. The store color-codes ingredients for shopper ease, and reinforces customer customization and personalization. Giving the customer control in the cooking process appears to be part of the store’s philosophy.
Organic meats and vegetables have been pre-cut, sliced, seasoned and packaged into portions that serve up to four. There’s a variety of premium cheeses, pastas imported from Italy, natural and organic pet food and baby food, and a small variety of pots, pans and other kitchen necessities. An in-house bakery with more than two-dozen specialty breads is also featured. There is a strong sense of authority and credibility in Really Cool Foods because of the way it displays, signs and sells its product. It is great at providing the whole solution, and communicates a distinct message around “healthy, quick and easy, and tailored for me” which really comes to life in the store.
Our troubles with Really Cool Foods belie the issue of communicating a new concept to consumers and determining how those customers use the concept in their lives. The name Really Cool Foods does not convey to a customer what the end promise is. It also is not clear how the store will function in their lives. It takes the food experience and whittles it down to two sub-sets: component cooking and organics. While both of these may be compelling trends, we’re not sure that they naturally go together. We have not seen much traffic in the stores, confirming our suspicions that using this store requires the retraining of consumer behavior over time—a luxury that not all new concepts have.
This is an extremely well-executed new format that shows sophisticated planning and attention to detail. We hope it can quickly find its target customers and establish this niche.
Famima
Upscale Convenience With Asian Influence
Famima is an upscale convenience concept brought to the United States from Japan’s No. 3 convenience store chain, FamilyMart, which owns 12,450 stores, half of which are located in Japan. As part of its quest for expansion, Family-Mart has opened 12 Famima stores in Southern California since 2005.
The store we shopped was the “landmark store” at 1348 Third Street Promenade in Santa Monica. It is in a prime location, right at the heart of an acclaimed, pedestrian hot spot where a large Asian population resides.
Famima’s store design is clean and simple, with an upscale feel created through hardwood floors and stainless-steel counter tops. The hardwood floor covered a majority of the roughly 2,000 sq. ft. of space, while tiles outlined the refrigerated cases. POS screens face out on the long, wide customer checkout counter, which gives customers a sense of control in their purchase process.
Famima is clearly differentiated through its offering, which included:
Asian staple foods such as sushi and rice balls, noodle bowls and Chinese buns;
Afriendly associate who actually served us fresh, hot, prepared samples of their grilled panini sandwiches and soup;
Avast assortment of high-end bottled waters, teas, energy drinks and specialty Asian beverages;
Sweet treats such as soft-serve ice cream; and
Fun and colorful stationery items plus daily and international newspapers and mag