QFC BAKERYat a glanceHeadquarters: Bellevue, Wash. Parent company: Kroger Co., based in Cincinnati, Ohio Market served: Puget Sound region of Washington and Portland, Ore. Annual sales: $900 million Management: Donna Giordano, president; John Turley, vice president, operations; Russ Calahan, director, bakery and delicatessen Number of stores/in-store bakeries: 86/86 Production methods: primarily frozen dough and frozen finished Product line: full line, including decorated cakes, gourmet cakes and desserts, artisan breads and breakfast pastries Competitors: Albertson's, Haggen, Safeway, Fred Meyer (also a Kroger company) Website: www.qfconline.com |
BEING THE LITTLE FISH IN A BIG POND is not an exclusive title for Quality Food Centers (QFC). The Bellevue, Wash.-based supermarket chain finds itself in the same boat as other regional chains around the country that have been acquired by national giants. QFC shares ranks with Chicago's Dominick's, Philadelphia's Genuardi's and others that face the challenge of maintaining their neighborhood grocer appeal under the umbrella of a large corporate chain.
QFC's big fish, Cincinnati-based Kroger Co., acquired the chain in 1999. Only a year earlier, QFC was purchased by Fred Meyer. When Kroger acquired Fred Meyer, QFC became a subsidiary of the country's largest supermarket and second largest in-store bakery operator. Kroger Co. operates more than 2,400 supermarkets and 2,200 in-store bakeries in 32 states.
In 2002, QFC's president, Darrell Webb, left the company to become president of Fred Meyer stores. Donna Giordano, who was previously vice president, sales and marketing, for Kroger's Denver-based King Soopers, took over the reigns as QFC president. Amid the corporate shuffling, sources say QFC began losing some of its regional appeal by dropping popular local vendors for Kroger's private label brands.
QFC officials denied claims that it was losing its regional identity and reported efforts to become one of Kroger's "most specialized" grocery chains. QFC officials declined to participate in the article, so information was obtained from industry sources and store visits.
Supermarket bakeries are a critical department where regional chains can maintain their neighborhood appeal. Bakery products, with their diverse ethnic origins and local history, help to differentiate grocers, but getting that message across to upper management can be a challenge, particularly as the chain grows or is acquired.
Bakery demands advocates
"The best way to retain your identity is through the leadership that exists in that market," says Bob Beckerman, former bakery/deli category manager for Eden Pairie, Minn.based SuperValu. Speaking generally about in-store bakeries dealing with new corporate owners, Beckerman says that too often senior managements appoint the bakery director position to managers with little experience in the bakery business. "Bakery directors need to be individualists able to express their views to senior management and validate their ideas. You need someone with some experience that is mature enough to defend their department," Beckerman adds.
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| QFC in-stores attempt to maintain local appeal with regional products, such as marionberry cheesecakes. |
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| QFC's new design features drop lighting and basket merchandisers in the in-store bakery. |
Quality Food Centers has an established reputation as one of the Northwest's leading upscale grocers. It holds about 18 percent market share in the Seattle area, which is second to Safeway at 30 percent. Albertson's, Fred Meyer and Haggen are its other top competitors. Under QFC's new ownership, remodeled stores, including bakeries specializing in artisan breads and gourmet are part of QFC's new direction.
The downtown Bellevue store, which debuted makeover last year, coordinates its in-store bakery conveniently with a Seattle's Best coffee shop located next to it. Both offer cash registers where customers can easily pay for their coffee and baked product. The store also features a second entrance, which leads directly into the in-store coffee shop.
QFC redesign
A QFC Bakery sign with soft lighting designates the in-store area where cake decorators prepare cakes in view of customers. Low-profile bakery cases contribute to the instore's open, approachable appearance. Earth-tone floor tiles and back splash also differentiate the bakery from the rest of the store, which features wood flooring.
Unlike many supermarket set ups, the bakery holds a unique position away from the prepared foods and deli departments. It also presents a more upscale image through its artisan bread and gourmet cake selections. The bakeries offer an extensive line of artisan breads, including a range of local brands as well as QFC-branded varieties.
Artisan breads are merchandised in both self-service and service displays. The service display of breads, presenting about ten loaves on tabletop trays behind glass, gives customers a close view of the products and encourages interaction with bakery personnel for assistance with slicing and meal ideas. The display also includes single items, such as biscuits, rolls and select home-style cookies, bringing added focus to these products.
"QFC has an excellent reputation, and the bakery in the University Village store is gorgeous," says a Northwest bakery supplier. "They're more of an upscale store, like Haggen, as opposed to its other competitors. QFC has been pretty good about differentiating its product line."
Decorated and gourmet cakes are among the areas the company uses to differentiate its in-store bakeries. Cake decorators work in front of the bakery in view of customers. During Modern Baking's visit, several customers brought the decorator cakes to personalize.
Decorated cakes are prepared primarily using frozen layers, and much of the gourmet cake line arrives to the in-stores finished. Gourmet cake varieties include fudge tortes, Lemon Delight cake, praline cake, strawberry Boston cream, German chocolate and carrot cake.
Mousse cakes and cheesecakes round out the gourmet dessert selection. QFC's marionberry cheesecake is one of its regional products. Marionberries, a blackberry variety, are native to the Pacific Northwest and are popular for use in baked products in Washington and Oregon.
The area's long tradition of fruit agriculture also comes through in QFC's pie selection. The bakeries offer pies, such as marionberry and Granny Smith apple, from several area orchards.
Maintaining an in-store bakery product mix with local flavor helps QFC stand apart from its competitors as well as other chains under the Kroger umbrella. Adding more onpremise baking would make QFC's in-stores even more dynamic. The key for its in-store bakery program will be whether its leadership can maintain QFC bakeries' points of differentiation over the long haul.
QFC BAKERY...a sampling of prices | |
| Cakes, pies, sweetgoods: | |
| Decorated cake, | |
| double layer w/ filling, 1/4 sheet | $16.99 |
| Single layer, 1/2 sheet | $24.99 |
| Apple pie, 9 ins. | $12.99 |
| Marionberry cheesecake | $17.99 |
| Fudge torte, 6 ins. | $9.99 |
| Carrot cake, 8 ins. | $12.99 |
| Cinnamon roll | .99 |
| Blueberry muffin | .99 |
| Artisan breads: | |
| Rosemary ciabatta, 16 ozs. | $3.95 |
| Citrus olive bread, 16 ozs. | $4.29 |
| Challah, 16 ozs. | $4.29 |
| Raisin pecan, 18 ozs. | $3.95 |
| Four seed, 24 ozs. | $3.39 |
| Roasted garlic, 16 ozs. | $2.99 |
| Sesame semolina, 16 ozs. | $3.69 |
| Whole grain, 1 lb. 2 ozs. | $3.49 |