Food fight in Aisle 3: Inside the big-stakes supermarket strategy to lure customers away from restaurants
Marco DiVincenzo pushes through the swinging doors to the back of a Longo’s supermarket in northern Toronto, looking for something to go with his sausages. This time, the head of the store’s kitchen is thinking peppers.
The produce department keeps a cart for him off to one side in the back, between all the boxes, walk-in fridges and people peeling hard-boiled eggs, mincing meat and juicing oranges. The cart is stacked with vegetables that are pulled from the shelves for one reason or another: a nick or a bruise here, or a patch of wrinkly flesh there.
“Customers get really picky,” DiVincenzo says, holding up a zucchini from his cart. “See the spots? They don’t like that.”
In an industry with lagging store traffic, luring customers away from restaurants is becoming a key battle
The zucchini is still good, though. So are the red bell peppers. He grabs a dozen or so. “I just want the red ones,” he says, heading back to his open kitchen at the front of the store, where he excises the peppers’ blemishes like a dermatologist and roasts them with sausages in the pizza oven, to be served at lunch on the store’s hot table.
One of the many virtues of a supermarket hot table is that, run by the right cook, it is a sturdy defence against obscene and unnecessary food waste. But, according to Canadian grocers and industry observers, that is merely a happy bonus, not the purpose, which is an industry-wide encroachment into the hospitality business.
Grocers group hot tables, salad bars, store-made pizza and take-home meal kits into what they call Home Meal Replacement, a $3.4-billion category in Canada last year, according to NPD Group. In an industry with lagging store traffic, luring customers away from restaurants is becoming a key battle, with big stakes. NPD research found 75 per cent of customers who come into a store to eat will stick around to shop for groceries.
Most grocers started with rotisserie chickens.
“I remember the first chickens that we cooked off were in 1990,” says Mike Longo, vice-president of fresh merchandising at Longo Brothers Fruit Markets Inc.
Nearly 30 years later, home meal replacements represent between eight and 20 per cent of Longo’s store sales, depending on the store. Urban stores tend to do better.
The chain of 35 stores now has three in-store restaurants and a new store selling prepared meals, meal kits and snacks to commuters in Toronto’s underground PATH system that runs under the business district. A forthcoming store in Toronto’s Liberty Village may also have a microbrewery onsite.
“We went through a whole strategy review and we looked at how we are going to remain relevant,” Longo says.
The result was a plan to compete for market share on 35 meals: three meals a day, plus two daily snacks, seven days a week.
“All of that is thought through now when we’re planning a store, whereas before it was like, ‘Hey we’ve got 10 feet over here, let’s put a table for people to sit down.’” he says.
The problem 10 years ago was that grocers were trying to be restaurateurs without the experience, says Robert Carter, an industry analyst at NPD.
“They never really hired restaurant people. So they didn’t have a strategy internally to grow it,” he says.
But, gradually, that has changed. In the past five years, Carter says, executives and staff have been jumping across the divide, from major restaurant chains to major grocery chains.
In a sense, the kitchen plays a commercial-scale game of the TV competition Chopped
DiVincenzo is a veteran buffet chef, who once cooked with Pasquale Carpino — the Pasquale, a beloved opera-singing TV chef in the 1980s and ’90s. DiVincenzo came to Longo’s after 10 years at Vinnie Zucchini’s, an all-you-can-eat Italian restaurant outside Toronto. He has stayed with the grocery chain for more than a decade, preferring the hot table to the repetition of restaurant cooking.
In a sense, the kitchen plays a commercial-scale game of the TV competition Chopped.
Although head office preordains a set of dishes daily, which show up on hot tables across the chain for continuity, the majority of the dishes are typically left to the in-store cooks.
DiVincenzo’s team of cooks get a different cart of ingredients in the morning, and have to come up with dishes for the hot table by 11 a.m.
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One morning in early September, DiVincenzo’s top lieutenant, Dottie Ilano, arrives at the store around dawn. She checks the walk-in fridge to see what the meat department has left for her. There are smoked turkey legs, packs of hamburgers and sausages, ribs, chicken breasts and veal shanks.
Ilano, a trained architect from the Philippines who has worked at Longo’s for six years, starts running combinations in her head.
She decides on a glaze for the turkey, so she sets a pot of pineapple juice and brown sugar to simmer on the stove. She’ll do the burgers as Salisbury steak in a mushroom sauce.
“You know what we haven’t done in a while?” DiVincenzo asks her.
“People go crazy for it,” he says.
DiVincenzo assigns himself to the sausage and peppers, as well as the veal shanks. After some deliberation, he dredges the veal shanks in flour, fries them lightly and brazes them in tomato sauce, tossed with cabbage, onions, snow peas and peppers from a recently de-shelved package of Asian Vegetable Medley, part of Longo’s line of cook-at-home meal kits.
The de-shelving process requires some explanation.
None of the ingredients are bad. Grocers call meat or produce within a few days of best-before date “at peak.” For example, Longo’s automatically pulls cuts of meat from the butcher case two days before their expiry date. The meat is good, but customers often don’t buy it because the window to cook it fresh is just too short. Instead, the store cooks it that day.
“I would expect that somebody somewhere says, ‘Hey, instead of getting rid of all this, let’s cook it,” NPD’s Carter says.
One of the virtues of a supermarket hot table is that it is a defence against obscene food waste
But one industry veteran says that’s not how it actually went.
Mary Dalimonte, a recently retired senior grocery executive with 10 years’ experience at Sobeys Inc. and another 30 at Loblaw Cos. Ltd., says customer demand drove the evolution of the hot table. If a store is doing its ordering correctly, she says, it shouldn’t be dealing with tonnes of waste.
More importantly, the hot table is solving a newer problem: catering to the myriad restrictions on the modern diet.
“You’re asking the question yourself when you go to a hot bar or salad bar,” she says. “What salad dressing do I want? Or do I want no salad dressing? Do I want protein? Or do I want to go vegan or plant-based tonight? Do I want gluten or do I not want gluten?”
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DiVincenzo has instructions for new cooks when picking produce from the cart in the produce and meat departments: “If you’re not going to feed it to your family, we’re not going to serve it.”
On this day, he wants some kind of sauce for the sausage and peppers.
“Dottie, do we have cherry tomatoes?”
She directs him to the party-size veggie trays, which are removed from the shelf after three days. He tears open the package and throws handfuls of tomatoes into his pans of sausages, then some baby carrots for good measure.
He pauses, looking at a bin of spices on a shelf while wiggling his fingers in the air and singing a Shawn Mendes tune, “I love it when you … call … me … señorita.”
“I’m missing something,” he says, looking at his pan.
“Celery?” Ilano asked.
“Yeah, I need celery,” he says. “It’s too much red.”
He doesn’t have celery in his cart, so he walks through the produce section, finds celery and brings it to the checkout, where it will be charged to the kitchen at cost.
Food costs are lower when you have the buying power of a grocery store chain, a big advantage over the restaurant industry, notes Carter at NPD. Food costs in fast-food restaurants generally take up 20-per-cent-plus of the total, and they take up 40 per cent in full-service restaurants.
Vince Piligra, store manager at the Don Mills Longo’s, says the hot plate’s cost is generally less than 20 per cent. And there’s the added benefit of mitigating waste.
“It reduces our shrink,” he says. “If you take ground beef and convert it to meatloaf, it retails at $21.90 a kilo (on the hot table) as opposed to say, what’s ground meat? $6.99. So you do the math. It helps the bottom line. Something that was going to be food waste actually becomes gold.”
The kitchen’s prepared meals make up around 10 to 15 per cent of the store’s sales.
“I’ve got a high-volume store,” Piligra says. “That’s a lot of sales for (the hot table). It’s a lot.”
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As DiVincenzo brazes his veal, between singing and whistling, he’s thinking out loud: this dish would be nice with pasta. That thought seems to percolate through the morning, until he finally announces to the kitchen that he will make his signature pasta for the lunch rush: linguine with artichokes, olives, roasted peppers and eggplant, sun-dried tomatoes and slivered garlic cooked slowly in olive oil.
He paces the aisles with a large rectangular pan known as a hotel pan, filling it with jars of eggplant and containers of olives from the olive bar. Around the store, people call him Fudd.
“Because I look like Elmer Fudd,” he says.
Aside from his bald head, it’s tough to see the resemblance. He’s 43, with two kids, and another on the way. He runs a DJ business on the side and jars tomato sauce and roasted peppers in his garage with his mother.
News of his pasta decision spreads through the store. One of the truck drivers hears gossip of the dish and inquires of the kitchen whether it is true. Elida, the store’s receiver, comes out from the shipping department. “Ooh,” she says, glimpsing the pasta sauce in a pan on the counter. “It’s there.”
DiVincenzo pulls out a string of pasta from the boiling water and wiggles it into his mouth. “Not yet,” he says.
By 10:30 a.m., Ilano is pulling pans out of the warming oven and running them to the steam table: grilled vegetables, ribs, Salisbury steaks, sausage and peppers, osso buco and salmon fillets in a poppy seed dressing — a dish mandated by head office to support the chain’s salmon promotion.
She pulls her coconut chicken from the oven and tastes the sauce with a plastic spoon from the soup-and-salad bar.
“No, no, no, no,” she says, and then adds pepper and paprika.
The last dish is the turkey legs. DiVincenzo slices and Ilano arranges them on the tray.
“Boss,” Ilano says, dipping a slice in the pineapple sauce, “try it with the glaze.”
Ilano pulls a plastic container from the fridge, filled with lilies she carved out of red peppers and celery stalks, and garnishes each pan. DiVincenzo throws parley on his pasta and a twist of orange on the barbecue ribs.
“That’s it,” he says. “That’s the hot table.”
He pauses. It’s minutes before 11 a.m.
“Wait,” he says.
He runs over to the salad bar, fills a cardboard soup container with chopped pineapple, shakes them out over the slices of turkey and steps away just as the customers lean in with their takeout containers.