When the COVID-19 pandemic hit in March 2020, one of the first of many operational changes grocers made was to shut down hot food and salad bars—hugely popular, high-margin fixtures. Although the virus is not food-borne, grocers prioritized safety and sanitation to help customers feel more comfortable.
Grocers filled the gap by transforming these areas into stations offering prepared individual and family meals and packaged salads and snacks. Some stores removed bars altogether and replaced them with other features.
Are grocery store food bars back for good?
By the summer of 2021, when COVID restrictions started to lift and bars began to open up again, shoppers were eager to return to stores. Of course, customer behaviors have changed. Experts have indicated that food bars are making a comeback even as pre-packaged meals become the “new normal” for consumers.
“What we’re seeing across self-serve areas, whether candy and snacks or salad, is that people who liked bulk or self-serve before are ready to engage now,” said Anne-Marie Roerink, president of 210 Analytics. “That’s resulting in very rapid growth in sales as the pre-packaged sales are now being augmented with the salad bar sales, and the numbers are actually starting to exceed 2019 totals for many retailers.”
Now that winter is here, soup bars are in full swing again, and they are more popular than ever. The International Dairy Deli Bakery Association (IDDBA) recently reported that the soup and chili category experienced a 40% increase over 2020 and 23.4% growth over August 2019.
Roerink suggested that grocery store customer behavior will continue to mimic other public outings like movie-going and large sporting and entertainment events with more people returning every day. As people continue to get vaccinated and return to work, grocery experiences will likely expand over time.
What is the future of high-margin food bars?
Most items in a grocery store earn about 1-3% profit. In contrast, salad bars can turn a 50-70% profit margin before labor and overhead costs. ProfitableVenture.com even suggests that a well-stocked salad bar—complete with vegetables, cold pasta, soups, breads, and more—can generate $25K to $30K per month.
Experts like Jonna Parker, principal of IRI’s Fresh Center of Excellence, explain that grocers are experiencing growth in deli and prepared food because people “are starting to get tired of cooking from scratch. Our most recent survey from October shows that we’re still eating 80% of our meals at home, but now people just want to heat something up rather than romanticize over making sourdough.”
She spoke explicitly about Barons Market’s hot bar customers who grabbed meals to eat at the store or soon after. “Now, many people will go to the deli wall and pick up a bunch of prepared meals for the week and warm them up at their convenience.”
How Can Grocery Stores Offset Rising Costs?
It makes sense that grocery stores pay particular attention to their food bar strategies to offset rising food costs, labor shortages, supply chain issues, and other operational challenges. Grocers want to do everything they can to prevent rising costs onto customers.
Here are some tips to increase sales and drive customers to high-margin food bar items:
- Find Customers Where They Are. Your in-house loyalty or rewards programs do a great job retaining loyal customers. To find and acquire new customers, you meet customers where they are: on the go and on their mobile phones.
- Frequently Change Menu Options. Changing meal offerings and food options frequently can keep customers interested and coming back. Of course, keep the most popular items, but try new flavors, combinations, and regional fare.
- Be transparent with customers. Let them know what you’re doing to keep food areas safe. Offer hand sanitizing stations, frequently change the cutlery, and have employees spray down public areas in full view. Also, consider posting signage that outlines your sanitation and safety protocols.
- Offer promotions. Some customers like to buy food bar items to supplement their meals, bring to gatherings, or store as meals for the week. Use personalized promotions to target the right customer at the right time to get them to higher-margin items, in a way that’s guaranteed to earn you profit.
One thing is certain: grocery stores are becoming much more capable of quickly adapting to customers’ needs as external forces– like shifting pandemic numbers– come into play. Businesses are leveraging what they’ve learned and are determining which customer behaviors are here to stay.