Friday, March 6, 2009

More blurring of retail/restaurant line

The resilience of the fast-food market during these perilous times hasn’t gone unnoticed by BJ’s, the regional club store chain. Executives told investors the warehouse membership chain expects revenues to rise by 4 to 6% during 2009, driven by increased sales at in-store food courts. And that’s after a 4% rise in revenues during the last three months of ’08, which they attributed to only two factors: food courts and propane sales.

Understandably, the retailer cited food courts as a primary strategic focus for 2009, along with product demos, a signature of arch-rival Costco.

Costco, meanwhile, says its food court business is also going strong, though officials did not divulge figures during their conference call with investors. They did note, however, that sales of take-home items like pizza have soared "dramatically." Costco's signature deal is a quarter-pound hot dog and a 24-oz. soda, sold as a meal for $1.50.

BJ's execs attributed the improved performance of that chain’s food courts to an emphasis on quality and the addition of such brands as Uno’s, Ben & Jerry’s and Green Mountain Coffee. BJ’s currently has 180 stores in 15 states.

The officials noted that sales of prepared meals were strong during the fourth quarter of 2008, but did not break out figures.

Meanwhile, they said, stores’ frozen-food departments saw “very strong sales” of products affiliated with restaurant chains, including The Cheesecake Factory, the Fresh City fast-casual chain, Panera Bread Co., Legal Sea Foods and Boston Market. The retailer also now stocks products licensed by Todd English, the famed chef.

Another point likely of interest to restaurateurs: BJ’s sales of organic and natural foods soared 20%.

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