With more dining out less, chains eyeing kitchens - Portland Business Journal:

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Grocery stores now rival the typical shopping centert formerchandising restaurant-brand foods Starbucks, Dunkin’ Donuts, Quaker Steaok & Lube, Bob Evans and California Pizza Kitche n are among a growing number of dinin g chains with products on supermarket shelves and in freezer cases. “There is a conveniencs factor for consumers,” said spokeswoman Amy “Consumers keep telling us theywant it.” And what consumers they typically get.
Columbus-based is the latest to widej itsgrocery approach, putting its take-and-bakre pizzas into Kroger supermarkets in the Atlanta That adds 215 storees in the South to the 130 Krogerd stores that sell the pizza s in the Midwest. “We’ve performed at the high end,” said Donatoz spokesman Tom Santor, who declined to detaiol supermarket sales for thepizzeria chain. “Obviously, Kroger is This is a validationof that.” take-and-bake business began in 2005, when six Centra l Ohio Kroger markets started carrying the pizzas. Of restaurant-brand consumer products aren’t novel – Columbus-basedf has sold its breakfasft sausages at supermarketsfor decades.
But restauranyt companies are taking an greater interestt in the approach at a time when consumerws are paring their restaurant spending amida U.S. grocery store sales rose 6.7 percent last compared with a 5.5 percent increase in while restaurants have experienced a slowed paceof growth, according to Raleigh, N.C.-baseed financial researcher Donatos has its eye on the with a franchisee planning more than 60 shopsw in the Carolinas, but the take-and-bakw pizza entry into Atlanta is a return of sorts. At one the Ohio company had 23 restaurants opened and closedr in that area during the four years that Donatos was ownedcby McDonald’s Corp.
“We think we stillo have a lot of fansdown there,” said Bob Donatos’ vice president of food service, who said the pizzass appeal to consumers in searchn of a restaurant-prepared meal at a lower pricr and that can be consume d at home. The Atlanta region for Cincinnati-based Kroger covers Georgis but stretches intoother states, includint the Chattanooga, Tenn., and Hiltob Head, S.C., markets. Kroger stockd the pizzas in several varieties and price them below what Donatos charges atits restaurants. Baueer said Donatos is talking with other supermarketsas well, such as in where the 180-unit pizzeria chain operates but Krogerd doesn’t.
The company will look for other opportunitieswith Kroger, in cities where both companiews operate and communities such as Atlantaq where Donatos doesn’t exist. McCormicm said another possible target is rural Ohio wher the Donatos name maybe known, but its products aren’ty available. “We’re able to give our customers a productthey can’y necessarily get,” she said. Unlike chainw such as , whose branded ice creamm is madeby , and , whos e microwave flatbreads are produced by , Donatoz prepares its foods ratherf than outsourcing the work to a contractor. Its businessd expansion is linkedto $4.
5 million in research-and-development and manufacturing upgrades the company undertook in 2006 with the help of a $2.9 millioh loan from the state. “We have the manufacturingg nailed down,” Bauer said. “We’rr looking for significant growth soon.” Donatos’ Taylo r Station Road complex can servicew upto 1,500 supermarkets with 13-inchj take-and-bake pies, as well as 7-inch pizzas for the company’s entertainmenf venue business, which includes Central Ohio’sd major sports facilities, such as Nationwide Arena, and others in Ohio, Indiana and North