Pushing the Limits of Foodservice

SandwichSandwiches are usually the first taste consumers get of your foodservice program, so it had better be love at first bite.

By Marilyn Odesser-Torpey, Associate Editor.

It was a true David and Goliath moment when Altoona-Pa.-based Sheetz, with 437 locations in six states, recently blocked a bid by Subway, the world’s largest fast food chain with 40,551 restaurants in 103 countries, to trademark the term “footlong” which it uses to market its sub sandwiches.

The Trademark Trial and Appeals Board ruled that the term “footlong” was in fact a generic term for sandwiches that was widely used in the food and restaurant industry.

Building a Food Business
Even though Sheetz doesn’t currently use the term “footlong” to describe its subs on its menu, standing up to Subway was an important step for the c-store chain because it shows how seriously it takes its sandwiches, said Darren Tristano, executive vice president of Chicago-based Technomic research firm. On its menu, Sheetz features 17 varieties of hot and cold six- and 12-inch subs.

Sheetz, widely regarded as the industry’s preeminent innovator in foodservice, is realistic when it positions itself as a competitor to Subway. Data from a report issued by Technomic last year showed that when consumers make more c-store foodservice purchases, they increasingly do so at the expense of restaurants. The majority of consumers (57%) who said they are purchasing convenience store foodservice options more often in the past month also said they have been visiting fast food concepts less often as a result.

And the number of sandwiches showing up on c-store menus is growing, Technomic reported. The number of sandwich items on c-store menus grew from 221 in 2012 to 304 in 2013, an increase of 37.6%.
Sandwiches are also a foodservice focus at Mapco Express. “Getting a customer to buy sushi in a convenience store requires a giant leap of faith, but a sandwich is more familiar and is regarded by consumers as less of a risk,” said Rickey Theel, MY Deli category manager for the Brentwood, Tenn.-based chain.

“It’s not that big a reach to add a breakfast sandwich or a cup of coffee, and, if the customer enjoys it, that sandwich can be the building block that leads to a meatball sub for lunch,” Theel said. “It’s a matter of gaining the customer’s trust more and more with each item.”

Basic sandwiches still sell, according to Technomic. Egg/breakfast are the leading sandwich varieties, followed by mayonnaise-based salads—chicken salad in particular—and turkey sandwiches.
“If you don’t get the basics right, you’re committing foodservice suicide,” Theel said. “Your sandwich has to be familiar, but better than anything your customers can get from a competitor.”

Expanding the Menu
Once the basics are in place, retailers have the opportunity to get creative with breads and toppings to really make their offerings stand out. Mapco Express, for example, recently introduced a chicken salad flatbread. Theel noted that the chain also makes its own horseradish mayonnaise, aioli and an olive salad that is used to create an authentic New Orleans-style muffaletta.

Other chains across the country are also building on their strong sandwich foundations by amping up the flavor profiles. Among the bolder innovations cited by Technomic were the Diablo Chicken Ranch Sandwich from 7-Eleven with sliced chicken, cheese and lettuce topped with a sriracha-ranch sauce on a pretzel roll and Twisted Brunch from Sheetz with homestyle crispy, spicy crispy or premium grilled chicken breast on a pretzel roll topped with pickles, lettuce, fire-roasted tomato sauce, mayonnaise, nacho cheese, caramelized onions, fried egg, ketchup and bacon.

Technomic also said it expects to see more use of pretzel rolls/buns following the result of successful sandwich debuts by chains like Wendy’s and Dunkin’ Donuts.

For Mapco Express’ MY Deli, Theel said the company is working on a limited time offer (LTO) program for 2014. “It not only inspires us to get creative, it also inspires our employees and customers to talk about our food,” he noted. “It also gives us a chance to suggest pairings with other food items—like ‘this sandwich is amazing with this soup.’”

For its Mapco locations without the MY Deli option, the company is testing a partnership with a Cordon Bleu-trained local caterer to provide freshly made sandwiches. Since the testing began in July, sandwich sales have been up 50% over the previous year, said Lisa Pickett, Mapco’s food service commissary manager.

The premium sandwiches, which include ham and cheddar cheese on sourdough bread and roast beef with pepper jack cheese on pumpernickel rye, are priced slightly higher than the standard prepackaged sandwiches the stores usually carry.

“Our caterer tells us what flavors and trends are hot and then it’s up to us to work on the pricing to make the sandwiches accessible to our customers,” Pickett said.

Taking Ownership of Food
Tedeschi Food Shops is experiencing great success with its new premium line of “Signature” artisan ciabatta bread-based sandwiches that was introduced in September.

“Typically it takes a while for a new item to gain traction, but this one hit the road running,” said Joe Hamza vice president of sales and marketing for the Rockland, Mass.-based chain. “In fact, we’re experiencing the most success ever in terms of new items right out of the gate.”

The new five-item line is a long way from a ham and cheese on white bread wedge. Unique, on-trend flavor combinations include chorizo and smoked gouda, fire-roasted veggie omelet, Italian with roasted red peppers, fire-roasted turkey and a Cuban sandwich with pork carnitas.

“These new items have an international flair inspired by our markets and consumer trends,” Hamza explained. “We have our ears to the ground, so we’re in touch with what our customers want and can anticipate trends.”

Tedeschi operates 191 c-store locations in Massachusetts and New Hampshire. Twenty-two of these units have in-store delis where both grab-and-go and made-to-order sandwiches are prepared. The other stores are serviced by Tedeschi’s own proprietary commissary.

“Fresh foodservice is a strategic initiative that we have put considerable resources and effort behind over the past five years,” Hamza said. “Our in-store delis and commissary ensure we have control over our recipes and the quality of the products in all of our stores.”

Tedeschi’s premium ciabatta sandwiches also carry a premium $7.99 price tag, making them the most expensive sandwiches on the menu. But Hamza says the company does not feel pressure from Subway’s $5 Footlong promotions to keep prices low. The c-store’s best selling Italian sub (as well as many others on the hot and cold sub menu) is priced at $5.89 for a small, $6.89 for a large.

“Our sales are telling us that our customers have accepted these to be the correct prices for these products,” Hamza said. “They are telling us that they see the value in these products. They are voting with their dollars.”

Retailers who do try to keep close to the $5 price point set by Subway can increase revenues by bundling sandwiches with higher margin items, such as soft drinks and chips, said Ted Roccagli, retail marketing manager/business coach for Gainesville, Ga.-based Mansfield Oil, which services 350 c-stores.

“Subway has been doing the $5 footlong for a long time and doing it successfully,” Roccagli said. “It has forced many of us to offer quality sandwiches at this price point, but that doesn’t mean we can’t still make a good profit.”

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