Emily's: something's cooking

Discount Store News, May 5, 1997 by Laura Liebeck

While supercenters and restaurants operators set their sights on home meal replacement, the grocery industry is fighting back to maintain market share. According to a report prepared for the International Foodservice Distributors Association and Food Distributors International, nearly seven out of 10 supermarkets now offer some type of prepared foods section.

The Food Marketing Institute is also keenly interested in the subject. The association's inaugural "Meal Solutions" convention seven months ago drew about 3,000 attendees, among them nearly 1,100 retailers and wholesalers. A report released at the conference pointed out that nine out of every 10 supermarkets include a dell and bakery section; seven out of every 10 supermarkets include a prepared foods section; and four out of every 10 supermarkets offer fast-food service with seating or standing areas.

Just because you're beating 'em doesn't mean you can't join 'em. That would seem to be the thinking at Boston Market, which has been stealing share from grocers, according to an IFDA report. The company indicated recently that it sees distribution through supermarkets as a long-term strategic move to expand its brand presence.

Eatzi's, the hybrid prepared food/upscale grocery phenomenon opened last year in Dallas by Brinker International, will open its second unit in late summer. Location: Houston. The unit will be about 50% larger than the 8,880-sq.-ft. original unit, which reportedly does about $1 million in sales monthly. About 80% of sales come from prepared meals.

Hungry but don't want to cook and too tired to sit in a restaurant? Join the crowd.

At Emily's, that is.

This spring, consumers in Phoenix will get a second look at Emily's and taste the latest in home meal replacement dishes and fresh groceries. Emily's will open a 5,000-sq.-ft. unit in Scottsdale, Ariz., the first of what its creators hope will be a chain of 250 restaurant/grocery stores nationwide. The original Emily's opened more than a year ago in the Chandler area of Phoenix while still part of Circle K Corp. It closed last November.

The new Emily's is taking a page from the playbook of Dallas-based Eatzi's and is the product of its new owners, Meal Market Inc., a Phoenix investor group whose members have foodservice, real estate, research and marketing expertise. Their objective is to refocus Emily's for greater longevity and consumer appeal. The group is being led by Gary Pryor, who serves as president and chief executive officer, and by Mark Cain, who is the company's chief operating officer. The investor group also includes Eddie Lynch and Bruce Merrill, a professor at Arizona State University. Pryor and Cain developed the concept for the original Emily's Market with Bruce Krysiak, chief operating officer of Circle K and founder of A.J.'s, an upscale supermarket in Phoenix.

After the spring opening, three more Emily's units are planned for the Phoenix area by January 1998. Meal Market will then add units in three Western cities next year, Pryor told DSN earlier this year.

"Emily's is designed for America," he said. Its four main objectives: convenience, variety, quality and service.

The new version, more like an Eatzi's, will feature gourmet food products in an upscale environment. The company's original store in Chandler, Ariz., while part of the Circle K Corp., was 4,200 sq. ft. and featured a cafeteria-style layout. (Circle K was retained an equity position in Emily's and holds a seat on the board of directors.)

The new store design will present food in stations so the consumer can see what is being prepared. With this layout, customers will be able to move among the various food preparation areas instead of waiting to arrive at the meal option they want. Also, the new version will have a total of 80 seats both inside and outdoors. The original Emily's offered no indoor seating.

Among the food offered will be a selection of prepared entrees and side dishes, salads, sandwiches, sushi, scratch bakery, pasta, rotisserie chicken, turkey and beef, and a wine and beer department. Groceries, both fresh and shelf-stable, also will be available.

The management team at Emily's wants to ride the home meal replacement wave, tempting busy, time-pressed people with high quality meals and meal parts. HMR is best identified with Eatzi's, which has abandoned its plan to franchise the concept in favor of a more controlled rollout, as well as Boston Market and Kenny Rogers' Roasters. When the new Emily's organization was announced last fall, it projected openings for the Phoenix area to total five to 10 units within two years.

At stake is a market with untapped potential, experts say, especially since 40% of people these days have absolutely no idea what they're going to eat for dinner by 4 p.m., and when they do cook, meals are simpler, taking minutes to prepare.

HMR could be a $100 billion business, said Manley Molpus, president of the Grocery Manufacturers of America. In a recent speech, Molpus called American consumers "kitchen challenged," noting that 80% of all meals are now prepared in 20 minutes or less.