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This month, we've assembled telling trend information from retailers on the subject of prepared foods. Respondents from four categories included specialty food stores, independent grocery/supermarkets, supermarket chains and independent delis. Their insights provide a glimpse into several factors from average prices per serving to labor costs to menu development that play key roles in the successful selling of this important category. We've condensed the results in easily digestible charts and graphs.

In addition, Deli Digest Editor Jennifer Strailey spoke with retailers from coast to coast to discover what's selling where, and got the scoop on the top trends broken down by region. From headcheese to whole poached salmon, she found that deli retailers court success by offering their customers a full range of specialty foods.

Specialty Food Stores Hit High Returns on Small Space
Responses from specialty food stores revealed pertinent facts. While the average number of square feet they actually devoted to prepared foods was the smallest (1,289 square feet), the actual percentage of prepared foods sold was the second highest in both the ready-to-heat category (36.22%) and in the ready-to-eat category (42.10%). In terms of average prepared food sales for 2005, they reported revenue that totaled $669,565, while the average percentage of total store sales generated by prepared foods was the second highest at 42.33%. The average retail price for individual servings of a main dish was the highest at $7.78.


Percentage of Prepared Foods Sold
Ready-to-Heat 36.22%
Ready-to-Eat 42.10%
Ready-to-Cook 16.11%
Frozen 14.58%

Average Retail Price for Individual Servings of Main Dish, Side Dish, Dessert
Main Dish $7.78
Side Dish $3.46
Dessert $3.55

In 2006, do you expect your Prepared Foods sales to
Increase 15% or more 34.8%
Increase 5–15% 43.5%
Increase 0¬–5% 13.0%
Stay about the same 8.7%

Independent Grocery/Supermarkets Do Best in Ready-to-Heat and Eat
Retailers in this category reported the second-highest 2005 average prepared food sales at $934,722, but surprisingly, the average percentage of total store sales generated by the prepared foods sector accounted for only 6.06%, the second lowest of all the retailers. Independent grocery/supermarkets sold the highest percentage of ready-to-heat prepared foods at 39.44% and the highest percentage of ready-to-eat prepared foods at 45.56%. They weren't heavy hitters in the ready-to-cook category (11.43%) or the frozen food category (11.00%) — they were the lowest percentages reported. The average retail price for individual servings of a side dish garnered the highest at $3.61, while the average cost for desserts was priced the lowest at $2.82.


Percentage of Prepared Foods Sold
Ready-to-Heat 39.44%
Ready-to-Eat 45.56%
Ready-to-Cook 11.43%
Frozen 11.00%


Average Retail Price for Individual Servings of Main Dish, Side Dish, Dessert
Main Dish $6.80
Side Dish $3.61
Dessert $2.82


In 2006, do you expect your Prepared Foods sales to
Increase 15% or more 12.5%
Increase 5–15% 25.0%
Increase 0–5% 62.5%


Supermarket Chains Devote the Most Space
Supermarket chains devoted the second largest amount of space to prepared foods — 2,400 square feet. They also reported the second-highest percentage of prepared foods sold in both the ready-to-cook (11.43%) and frozen food categories (11.00%). The most telling response in this category was the average amount of prepared foods sales ($2,520,833) — they rang up the highest, compared to the average percentage of total store sales generated by prepared foods (5.55%) — the lowest. Supermarket chains charged the highest average retail price for desserts ($4.77), but the lowest average price for a main dish ($5.59). When asked if they expected their prepared foods sales to increase, supermarket chains had high hopes, with 100% of all respondents expecting growth.

Percentage of Prepared Foods Sold
Ready-to-Heat 30.83%
Ready-to-Eat 40.83%
Ready-to-Cook 18.00%
Frozen 16.00%


Average Retail Price for Individual Servings of Main Dish, Side Dish, Dessert
Main Dish $5.59
Side Dish $2.88
Dessert $4.77


In 2006, do you expect your Prepared Foods sales to
Increase 15% or more 33.3%
Increase 5-15% 66.7%


Independent Delis
Independent delis devoted the most amount of space to prepared foods (4,175), but generated the lowest average sales ($242,500). Ironically, they had the highest percentage of store sales generated by prepared foods (44.60%). Of that percentage, 21.25% was from ready-to-cook items, and 25.00% from frozen foods — nearly double that of independent grocery/supermarket retailers. Independent delis charged the second highest average retail price for desserts ($4.74), but the lowest average price for a side dish ($1.99).


Percentage of Prepared Foods Sold
Ready-to-Heat 32.00%
Ready-to-Eat 38.75%
Ready-to-Cook 21.25%
Frozen 25.00%


Average Retail Price for Individual Servings of Main Dish, Side Dish, Dessert
Main Dish $6.74
Side Dish $1.99
Dessert $4.74

In 2006, do you expect your Prepared Foods sales to
Increase 15% or more 20.0%
Increase 5–15% 19.0%
Increase 0–5% 61.0%

The Greatest American Deli: A Regional Trend Roundup
By Jennifer Strailey

While the traditions and tastes of an area undoubtedly influence its deli fare, we found that national trends and a retailer's location — whether near a major university, a retirement community or an office complex — have as much impact on what sells in the deli as regional preferences. So, while beef tongue is bigger in Boston than out in Scottsdale, Ariz., retailers from sea to shining sea reported an increase in demand for artisanal products, homemade specialties, and cheese, cheese and more cheese. Following is a look at what's hot by region:

New England
Cardullo's Gourmet Shoppe in Cambridge, Mass., serves up Old World specialties like beef tongue, headcheese and eastern European specialties not commonly available at conventional supermarkets. But it's Cardullo's sandwiches that students and neighborhood folks alike covet. "We're known for our great sandwiches," asserts General Manager Josh Eaton. "People love the menu because it's eclectic."

Cardullo's sandwiches are equally prized for the high-quality ingredients with which they are made. Three sandwiches are made with house-made duck confit, and all of the meat used in the sandwiches is organic free range.

The most distinguished sandwich on the list is The Russian. For $65, customers can savor one ounce of Russian Osetra caviar and crème fresh on any kind of bread they like. "At that price, we don't charge for the baguette," jokes Eaton. The retailer has sold two of the top-dollar sandwiches this year.
Other sandwiches from the Perigord (duck confit grilled with white truffle cheese) to the Grecian Turn (roast lamb, tomato, cucumbers and imported feta with extra virgin olive oil) are priced from $5.95 to $8.95 — a fair price, considering the heaping helpings. "Our portions are quite large," observes Eaton.

The Northeast
Cheeses, homemade dishes and unique specialties are the bread and butter of Bon Appetit Fine Foods in Princeton, N.J. Owner and Manager Michel Lemmerling devotes about half of his 4,500-square-foot store to deli items, with cheese occupying the lion's share of that real estate.

"Cheese is our number-one category," says Lemmerling, who carries between 220 and 250 cheeses. In the last five years, Bon Appetit has added 50 cheeses to its offerings. The majority of them are American — another trend, says Lemmerling — "It's not just Velveeta anymore. There are all those beautiful specialties from Wisconsin, Vermont, and even New Jersey."

From American farmstead cheese to Italian butter to ginger cookies from Holland, "people come here for the hard-to-find specialties," says Lemmerling, who considers his shop a "little Dean & DeLuca." Nearby Princeton University brings in people from all over the world, as do the area's big international companies like AT&T. Consumers in this central New Jersey town are as food savvy as Manhattans and Bon Appetit is committed to satisfying their sophisticated palates.

The South
Artisan cheeses are also the rage hundreds of miles away at A Southern Season in Chapel Hill, N.C. "We have a selection of about 500 cheeses," notes Assistant Deli Manager Cindy Becken. "Interesting artisanal cheeses and goat cheeses are really picking up for us. We're trying to offer small farm cheeses that are different from what other supermarkets carry."

Becken also finds that sandwiches, hot soups and a broad selection of freshly prepared foods ranging from good old Southern barbecue to Indian samosas are driving customers to the store.

White chicken chili is A Southern Season's number-one selling soup, while beef brisket is a big hit in the Prepared Foods Department. Many of the deli's most popular dishes are those that require slow cooking, as time is the one ingredient harried customers don't have.

Southern specialties like barbecue made with local pulled pork and just the right amount of vinegar dressing, country ham salad and Southern potato salad made with Duke's mayonnaise are staples in the deli, as is the Tar Heel Sandwich. Named for the North Carolina University Tar Heels, this Chapel Hill favorite made with turkey, bacon, cheddar, lettuce and tomato is served heated.

A Southern Season caters to some University members, but the core of its business comes from professionals working in area businesses. During the lunch hour, the 10-foot salad bar featuring a bounty of greens, tuna salad, chicken salad, nuts, raw and marinated veggies has become a focal point.

The Midwest
Foodstuffs, a gourmet deli and catering company with four stores in Chicago's northern suburbs, features a daily-changing menu of freshly prepared foods, soups, salads and sandwiches. The retailer's full-service build-your-own salad bar featuring 30 fresh salad ingredients has been a runaway success, as have Foodstuffs' low-carb and Weight Watchers menus.

While the full-service salad bar was available in some locations, the retailer only recently implemented the garden of goodies at its Lake Forest store. "We had a Seafood Department at the Lake Forest store that wasn't doing that well, so we removed it and put in a salad bar and eight tables with seating," explains Terry Bluver, general manager for all four stores. "It's been so successful, it's turned the store around."

In addition to its regular menu of deli specialties, Foodstuffs offers low-carb and Weight Watchers menus that break down the number of carbs and points per serving, respectively. The customer response has been "absolutely phenomenal," notes Bluver. The health and diet trend has further influenced the regular menu, where Foodstuffs has cut back on pastas and beefed up on grilled veggies.

Sandwiches are another big draw for Foodstuffs, says Bluver. The store offers between 25 and 30 sandwiches every day in addition to any combination of ingredients customers may desire. Sandwiches are particularly important at the Evanston location, which is close to Northwestern University. On game days, customers line up for Foodstuffs' top-selling sandwiches, including: The Norm (a homemade chicken salad sandwich), Sorry Charlie (made with the house tuna salad) and the California (turkey and avocado).

The Southwest
While the Southwest is famous for its flavorful Tex-Mex cuisine and other spicy delights, customers of AJ's Fine Foods in Scottsdale, Ariz., are more interested in Beef Wellington, clam bakes and pasta than blue corn enchiladas.

Bistro Manage Stacey Harris says harder-to-find gourmet specialties, artisan French cheeses and creative freshly prepared meals are the talk of her store. Contrary to carb-counting Chicagoans, AJ's clientele have made their Pasta Night one the retailer's biggest successes. On Pasta Night, AJ's chef prepares pasta to order with 13 different fixings of the customers' choosing.

Greek night and clambakes out on the retailer's patio also have been successful. "Our special events are a big draw," notes Bistro Manager Stacey Harris, who is currently planning a Running With the Bulls promotion for this July. Spanish cheeses and made-to-order paella and tapas will be part of the colorful festivities.

Arizona's warm climate also attracts lovers of the outdoors, so healthful foods are big sellers at AJ's. "We do items from the South Beach Diet book every Monday, Wednesday and Friday," says Harris. "We prepare the meals right from the book in response to customer demand."

The West
"One of the most exciting things I'm seeing is that we're starting to get more artisanal American charcuterie and meats on the level of specialty American cheeses," says Stephen Schaefer, cheese and charcuterie manager for Dean & DeLuca in St. Helena, Calif. From aged salamis to smoked pork, customers at Dean & DeLuca are savoring specialty charcuterie in its many forms.

"I've got one supplier who makes salami from Berkshire pigs, which are recognized as the most flavorful pork," says Schaefer. "In the past, you didn't get salamis with species variety." While the breadth of charcuterie available in this country has increased, so too has the American appetite. "Now I'm able to sell exotic wild boar bacon, duck bacon, three or four varieties of pancetta, two Jamon Serranos, Specht from Italy, country ham from Virginia and all these little salamis from start-up manufacturers — some of which I had never heard of after 25 years in the business."

Locally made and artisanal products are among the most coveted of Dean & DeLuca's staggering selection of specialties. Schaefer points to the success a fresh-cured olive from the town of St. Helena, as well as locally produced wine, cheese and salamis. "We're really lucky here," says Schaefer. "Not every retailer can source products from 15 miles away."

But Schaefer, who considers the San Francisco Bay Area the second largest specialty food market in the country after New York, also brings in products from around the world with great success. "As amazing as it sounds, in the heart of California wine country, I don't carry Monterey Jack," says Schaefer. "I don't carry a lot of staple cheeses because that's not what people come here for. I need a good selection of D.O.C. cheeses, American and artisanal cheeses."

To enhance the specialty cheese experience, Schaefer offers a variety of complementary products. "We've seen an explosion in the availability of accompaniments to cheese, like fruit paste, for example. We're now getting stuff from New Zealand, Australia and Spain that add a level of excitement and complexity to the artisan cheese experience."

The Northwest
At Elephant's Delicatessen in Portland, Ore., Cheese and Charcuterie Buyer Jaime Bauer seeks products with local appeal. "The style of food in Portland is influenced by our location in the Northwest. We use lots of wild salmon and seafood. We're very proud of the things that grow here like wine, hazelnuts and local cheeses."

The full-service deli offers sandwiches, soups, hot prepared foods, a full gourmet cheese counter, made-to-order grilled foods and homemade breads. Two months ago, the deli added a full-service antipasto bar that is receiving glowing reviews.

Some of the deli's best sellers include a tomato orange soup with a little cream "that people can't get enough of," says Bauer. Whole poached wild salmon and upscale meatloaf made with free-range meats and homemade breadcrumbs from Elephant's bakery are also favorites. "Our breakfast sandwiches — croque madames and croque monsieurs — are also popular," notes Bauer.

When Portland doesn't feel like cooking, they're likely at Elephant's Deli, where frozen and chilled foods for entertaining take center stage. Dips, spreads and tapenades, along with frozen spanikopita, mini quiches and tartlets make cooking for company a snap.