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To stay competitive, independents must stay on top of food service trends to best serve and appeal to shoppers in their communities. Right now, one of the hottest trends is grocery deli-prepared food. 25% of shoppers are purchasing more deli-prepared foods according to FMI’s The Power of Foodservice at Retail study, while 57% are purchasing the same amount.
“Foodservice at retail has gained considerable momentum,” the report says. “It’s a star within the overall deli foodservice department.”
With inflation top-of-mind, 53% of consumers say grocery deli-prepared foods are a good value compared to eating at a restaurant or ordering takeout, according to the report.
At this year’s International Supermarket Management Class in Atlanta, Dairy Farmers of Wisconsin VP of Food Service and International Rick Findlay revealed the hottest trends in deli, which can turn your store into a meal solution destination.
“I am a little bullish on this category or this department moving forward because people are back (after COVID-19),” he said, noting that most VPs and directors of deli are expecting the deli department to be in the 8% to 10% growth rate in sales through 2025.
Below are six of the trends he highlighted for the deli department. Look to The IGA Minute for part two in the coming weeks, where we will cover how to reduce shrink in the deli.
Thanks to the overarching umbrella of healthier eating, fermented and pickled foods, which improve gut health, are very popular.
“I've never seen so much kombucha or kimchi sold in grocery stores or in restaurants as has been in the past year,” Findlay said. “And we see that continuing at least for another couple years.”
To do: Independent retailers can easily substitute apple cider vinegar in a variety of recipes, from cabbage salad (in the dressing) to marinades and create their own signature pickle or kimchi recipes.
Known as an anti-inflammatory primarily for joint inflammation, turmeric is on fermented foods’ heels as the second largest trend. The spice has a deep, golden orange color that adds a peppery, musky flavor to dishes.
Brands are jumping on the trend, with Kettle Brand potato chip to soon release a turmeric-infused potato chip. These tumeric ranch flavored popped chips from mindright are another example.
To do: Add tumeric to your deli’s pork chops, soups, or vegetable dishes, and clearly mention it on the signage. You can even note its anti-inflammatory properties in the description.
Spicy dishes are no longer just for the daredevil of the group. Going beyond heat level and into specific underlying flavor notes is something you should consider in dish offerings.
Many cuisines offer spice blends that bring out unique flavors. For example, jerk seasoning adds heat to meats and vegetables thanks to the Scotch bonnet and cayenne peppers. It brings out flavor with allspice, nutmeg, thyme, and garlic and onion powder.
Along with heat, you should also consider spice blends for your prepared foods.
Za’atar is popular in Middle Eastern dishes. The earthy, nutty flavor comes from dried thyme, oregano, caraway, dill, marjoram, sumac, and sesame seeds, and is especially popular on roasted carrots and in baked eggs.
“I can't emphasize spices enough,” Findlay said. Discover your community demographics and see which spice blends would be most relevant to them.
To do: Label your spicy foods as such and add descriptions of unique spices to pique the interest of curious shoppers. And don’t forget to season your meal solutions that shoppers can cook at home. Strack and Van Til, an independent chain with 21 locations in Northwest Indiana, packages cut raw chicken, peppers, and onions for fajitas that come seasoned with their famous fajita blend.
Rick Findlay speaking at the 2023 International Supermarket Management Class.
As shoppers seek greater value during high inflation, they also reduce their consumption of more expensive items like meat. This shifting behavior presents an opportunity to highlight deli dishes using high protein beans, legumes, and grains like chickpea and quinoa salads.
“Protein costs have jettisoned the last couple of years. Beef prices, poultry prices: it's driven the market significantly higher,” Findlay said. “To make up for that, we're starting to use beans, legumes, and grains as a bigger portion of our menus, and it's doing extremely well.”
To do: Add wobblers and stickers with the phrase “high protein” to these dishes to call attention to their nutritional value. Feature these dishes in your circulars and on your website and social media pages as part of your value offerings.
Quick service is key for busy shoppers. Whether it’s prepared, pre-packed deli foods for easy grab and go (like guacamole, chicken salad, etc.) or salad and hot bars for self-service, shoppers are hungry to get in and get out with prepared meals.
“25%+ of Whole Foods’ store sales – about 50% of the foodservice sales – come from those bars,” Findlay said, adding that Whole Foods’ store-made guacamole and salsa has an 80-90% margin.
To do: If you are not sure what to add to your Grab & Go consider starting with sandwiches, wraps, Salads, and side dishes like macaroni & cheese or roasted vegetables.
“If you're not into soups, you need to get into soups,” Findlay advised.
The reason is twofold, he said. Soups offer an extremely high margin of 50-70% with little work, as grocers can purchase base broths then add proteins to it.
Even better, it's a phenomenal exit strategy for unsold products, with a 50-70% potential margin. If the meat department has too many chucks, rounds, or center cuts left over, throw them in your next chili. Did you order too many rotisserie chickens? Now you have chicken noodle soup.
To do: Assess your soup offerings. Try using expiring vegetables and extra meat for an in-house recipe, calling out “Made in store” in your visual merchandising and in circulars and on social media.
The deli department in grocery stores is poised for growth and success in the coming years. With the convenience and value that deli-prepared foods offer compared to dining out, customers are increasingly drawn to these options. Become the go-to destination for shoppers seeking delicious, convenient meal solutions by catering to their preferences and incorporating the above trends into your deli offerings.
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