Entrepreneurial adage: One door closes, another door opens. How true! Here in Philadelphia on the Northeast corner of Broad and Chestnut streets, Borders closed their doors; Walgreens just stepped in with a super store. Smart move given the forecast for food purchased at retailers for at-home consumption through 2022.
Last week I made my first visit to the new Walgreens. When entering the store positioned by the door is a refrigerated island merchandising “grab & go” sandwiches, salads, wraps, sushi, fruit cups, bags of produce, boxes of strawberries/blueberries, healthy/unhealthy snacks, etc. There were additional foods in the back of the store on floor one, as well as on the second floor complete with seating. Impressive, but if you really want to be knocked off your feet, check out their super store at 151 N. State St. in Chicago complete with a juice bar, a selection of more than 700 wines, artisan cheeses and an assortment of specialty meats.
The NPD Group forecasts that prepared food purchased at retailers for at-home consumption will increase by 10 percent over the next decade. That does not bode well for restaurants which they project will grow at 4 percent. Each demographic group according to NPD has a different set of needs; consumers 35 years and older are more likely to buy prepared foods from retail compared to consumers 18-24 who prefer snacks or seniors (+65) who look for lunch items. Pizza, chicken, macaroni & cheese and sandwiches continue to be popular items.
It is time for restaurants to step up their game. Candidly it might be too late to pull consumers out of their homes and back into restaurants since everyone is opting for their in-home technology cocoons (e.g., gaming, social networking, movie streaming, etc.). One area of growth will be takeout and delivery thanks to technology. Consumers now have more options to order and pay via their smartphones when it comes to pickup “grab & go” or delivery. However, restaurants will still be challenged to deliver quality food in a speedy fashion compared to what a Walgreens superstore offers.