Deli Counters: Deli-cutlessons

Many c-store owners are eyeing up deli counters as a way to tap into the European-style culinary culture sweeping the UK. But it isn’t just a case of loading up a counter with meat and olives and, hey pesto, the business comes pouring in.

“Broadly speaking, for convenience stores differentiation is the key to success, and deli counters are an excellent way to do something different,” says Association of Convenience Stores public affairs director Shane Brennan. “However, delis are hard to do well. It’s a big investment both in terms of time and money.”

He claims that customer demographics are also a crucial factor in deciding whether or not a deli will work for you. When considering which customer profile delis best serve, ‘affluent’ is a word often bandied about, but Brennan states that their appeal is more complex than whether or not people are considered to be wealthy.

“Particular ethnic groups, like the Italian community, have deli shopping as part of their culture. Delis also appeal to older people those with more time who like to chat and ask questions about the food they’re buying. They see something special in the whole ‘counter’ experience.”

Mike Boyce, from Daisy Fresh and Essential in Wolverhampton, thinks that the appeal of the deli counter stretches even further. “There’s no one customer profile,” he says. “It really is across the board. When I took over the store 10 years ago, putting in a deli counter selling meats and cheese was one of the first things I did and it’s proved to be a great draw.”

Today, the top sellers include cooked hams, gammon, quiche and olives. He adds that keeping the cooking on site strengthens products’ appeal as the scents from preparing products tempt in customers. “The aromas are to die for on some days,” he says.

But while the fresh-cooked smell may be tempting, c-store owners who plump for deli counters often complain that the paperwork involved in set-up isn’t as appealing.

“The miles of paperwork when we started was a real nightmare,” says Mike. “We’ve evolved with the health and hygiene legislation. At the start, things such as cross-contamination weren’t considered, but they’re essential now. Because these products go straight from the counter into people’s mouths everything has to be 100%.”

Mike says that working closely with local authority health officers is vital if you want to avoid any nasty surprises.

Mark Santangeli, from Santangeli Grocery and Deli in Edinburgh, agrees that maintaining health and hygiene, though necessary, is a drain on staff time. “Deli counters are all stainless steel, and that has to be thoroughly cleaned, along with any machinery, before you can close. It’s an hour-and-a-half after you’ve shut the door before your staff can finish up. And you’ve got to prepare food for the next day and make sure stock is labelled properly.”

Waste watchers

One of the issues Mark also highlights is wastage. He says that when he launched the deli they’d offer fresh cooked hams. Unfortunately, what didn’t sell then had to be thrown away, which led to profits being thrown in the bin.

“Now we offer pre-packed meats, which are brilliant because they’re already marked with a sell-by date, and because they’re vacuum packed they still offer excellent quality, but there’s less waste.”

Paul Fisher, who owns Fisher’s of Gerrards Cross in Buckinghamshire, claims a little market research goes a long way in terms of avoiding wastage. “Canvass the local area asking them what they want from a deli and they’ll tell you. Your customers will soon let you know if you are doing it wrong!”

And it’s not just a good product selection that will ensure a busy deli counter; the right counter location is also vital. “Just over a year ago we upgraded our deli counter hardware and moved the section to the front of the shop,” says Paul. “This has seen an improvement in customer service as there is always someone to greet customers, plus turnover of the section has risen by more than 50% year on year.”

Andrew Porter, from Eurospar Creightons of Finaghy in Belfast, has also reaped the rewards of his deli counter. He started investing in his deli counter “properly” two and a half years ago. Now he estimates it accounts for about 10% of his sales.

Breakfast and lunch are the big meal occasions. In the morning the store does well with deli favourites such as bagels and locally sourced soda bread, while customers come in at lunch for the salad selection.

Says Andrew: “If you get it right it’s a high margin business. We see it as a profitable department, since if you stock good quality products you can charge that little bit more.”

Awardwinning Budgens retailer Guy Warner is positive about the deli experience, but more cautious about the rewards.

“Well-run delis offer the opportunity to showcase quality food, customer service and add a sense of theatre to the store. They have a ‘halo effect’ which draws customers through the door. But, if you’re asking if it will add bucket-loads to your bottom line well, probably not. If the deli counter accounts for 3-5% of your turnover, you’re doing well.

“The margins are potentially attractive,” he says. “But you have to offset that against the cost of running the counters themselves.”

Andrew believes that getting the right staff can be tough. He has very exacting ideas on the qualities he believes deli staff should possess, which include a real passion for food, excellent customer service and an outstanding working knowledge of health and hygiene.

“I’d recommend getting a deli manager who is experienced, wants to see the deli counter grow, and who can manage it right,” he says.

“If you have staff who are professional, and bring a sense of ‘play’ to the counter then you’re halfway there,” adds Warner. “There’s nothing worse than a deli counter half-heartedly run by people who clearly don’t enjoy it.”

So are deli counters a worthwhile investment? Two years ago, Mark scaled down his to concentrate on the grocery side of his business. Although he values his deli as a point of difference, he concedes that the future holds many challenges. “People are often too busy to wait at a counter, pick out their food and be served individually. And now the supermarkets are competing on price with deli-style products such as speciality meats and olives.”

However, others see the rewards as too good to turn away, regardless of the work involved.

“It’s a challenge,” asserts Mike, “but it’s definitely been worth it.”