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Case Study: DOM’s Kitchen & Market May Offer Glimpse at Future of Grocers

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Case Study: DOM’s Kitchen & Market May Offer Glimpse at Future of Grocers

Recently opened DOM’s Kitchen & Market in Chicago’s Lincoln Park neighborhood is putting a rather unique spin on the supermarket-restaurant concept, in an effort to lure customers multiple times per week.

The 17,150-square-foot supermarket is the creation of supermarket veterans Bob Mariano, former CEO of Roundy’s Supermarkets Inc. who founded the Mariano’s grocery chain; Don Fitzgerald, a former senior executive at Roundy’s, Mariano’s, and Dominick’s; and Jay Owen of Dom Capital Group, great-grandson of Dominick’s Finer Foods supermarket founder Dominick DiMatteo. Investors are receptive to the idea of an upscale supermarket with restaurant-quality food.

In March 2021, DOM’s raised an additional $15 million from investors including Cleveland Avenue (founded by former McDonald’s CEO Don Thompson), Beliade, Molto Capital, Valor Siren Ventures, and Wasson Enterprises. In total, DOM’s has raised $25 million in capital to build more stores in the future, reported Restaurant Business (March 31).

Of late, consumer spending on food away from home (FAFH) has been taking share from food at home (FAH) in terms of total spending. FAFH’s share of total food spending rose from under 40% in 1992 to over 50% in 2014-15, dropping to 30% in April 2020, according to U.S. Census Bureau data cited by the FMI (Food Marketing Institute) in its U.S. Grocery Shopper Trends 2021 report.

During the height of the pandemic, FAH’s share of food spending rose to 70% in April 2020 but declined to 50% in March 2021 as the country became vaccinated and opened up, and consumers returned to restaurants, as noted by Supermarket News (June 14).

The Allure of Fresh Prepared Foods

Foodservice in supermarkets is big business, with retail sales of deli-prepared foods recording $12.7 billion in sales for the 52 weeks ending June 8, 2019, according to the Nielsen Total Food View data, as cited in FMI’s 2019 Power of Foodservice report. Offering fresh prepared foods not only brings in revenue for the deli or foodservice department but allows supermarkets to sell additional items such as wine, juices, and ice cream.

Supermarkets have been dedicating more square footage to foodservice since 2010. Whole Foods Market, for example, offers coffee bars, wine bars, Mexican and poke bowl stations, along with its hot and salad bars. The Mariano’s grocery store, founded in 2010, introduced barbecue food stalls and oyster bars to the Chicagoland supermarket scene. In 2019, Raley’s remodeled its Bel Air Market in Folsom, California to add an in-store Chocolate Fish coffee shop featuring a made-to-order pizza bar, Brazilian acai bowls, ramen bowls, and Mongolian-style options, as noted by Supermarket News.

DOM’S Model

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DOM’s Kitchen & Market emphasizes meals with four food stalls (Plant Butcher: made-to-order salads, The Stackup: sandwiches, The Hearth: Bonci pizza and rotisserie meats, and Gohan: sushi and rice bowls), The Brew coffee and wine bar, a Chef’s Table, and multiple seating areas including a greenhouse room, seats at the Chef’s Table, and an enclosed outdoor patio.

What differentiates DOM’s from other supermarkets with food stalls, however, is its aesthetic and the buzziness of the Chef’s Table.

DOM’s coffee and wine bar and dining areas look like a restaurant in Chicago’s trendy West Loop neighborhood, not as a seating area to quickly consume a sandwich. To create a restaurant feel, DOM’s founders ventured outside the grocery industry and hired New York City design firm Rockwell Group. Bringing in restaurant chefs to do culinary demos and offering special events such as its recent Dom’s Pride Brunch Party offers an interactive and changing element.

If DOM’s Kitchen & Market initial store concept proves successful, we may see more small-scale supermarkets copy its formula of combining a restaurant’s ambiance and energy with a wide array of fresh prepared foods.

Virginia Lee is a food, drinks & beauty trends explorer and market researcher. She has advised companies on innovation and market entry opportunities in consumer packaged goods at Euromonitor International, Brightfield Group, and Innova Market Insights. Connect with Virginia on Twitter and Instagram at @VirginiaALee.

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